Ask the Liberals to study new mortgage rules
The Ottawa Liberals have introduced a set of new mortgage rules titled B-20. Amongst other changes, these rules introduced a mandatory 2% stress test for all qualifying mortgages.
Mortgage Professionals Canada has estimated that 100,000 Canadians have been prevented from buying a home due to the stress test and that 18% of prospective buyers, who could currently afford their preferred home, would fail the stress test. Recent data from the Bank of Canada data shows that mortgage growth has hit a 17-year-low in Canada with more and more middle-class buyers being priced out of the market..1 While young Canadians and first time homebuyers are most acutely impacted by this punishing new stress test, the losers include pretty much everybody. As the Liberal changes continue to suppress the market, Canadians will see their positive equity eroded or their negative equity increased. What’s more, the economic slump spurred by the stress test is estimated to cost Canada about 200,000 jobs over the next three years.
The Ottawa Liberals would have you believe that these new rules are preventing risky borrowing in Canada. However, the exact opposite seems to be true. The number of mortgages issued to people in the pre-war generation – aged 73 to 93 – jumped by a whopping 63 per cent in the first quarter of 2018 due to older Canadians signing off on the mortgage loans of their younger family members.3
These new rules are punishing middle-class families and are incentivizing risky borrowing.
Conservative Member of Parliament, Tom Kmiec, has repeatedly asked the finance committee to study these new mortgage rules but the Liberal members of the committee have refused twice.
Pressure the Liberals to study these mortgage changes by emailing the committee chair!
For more information:
Kieran Moloney
Office of Tom Kmiec, MP
Tom.Kmiec.A6@parl.gc.ca
613-992-0846