SPRING 2022
A the vanguard
s results of the 2021 Census continue to be analyzed, Canada continues to be the fastest growing G7 country, a statistic that has remained unchanged for five years. The population growth is certainly an attributing factor to the exceptionally hot real estate market across the nation, and it shows no sign of slowing down. This past year has seen real estate price increases reporting as high as 25% to 30% in some top markets.
The industry’s unprecedented pace in which it has grown has led to some natural changes where regulations, policies and laws are concerned. The benchmark rate used by major banks for stress-testing the finances of new home buyers has been reviewed
10
|
and adjusted to help manage long term risk for both financiers and homebuyers. The Office of the Superintendent of Financial Institutions (OSFI) raised the minimum qualifying rate for uninsured mortgages from 4.79% to 5.25%.
REVEALMAGS.COM | OWNERA MEDIA a subsidiary of OWNERA Group Inc.
Although it remains unclear as to the level of impact this change will have on the temperature of the market, it is likely that it will directly lower the homebuyers purchasing power. The Canada Mortgage and Housing Corporation (CMHC) has continued to adapt its policies based upon changing risk levels throughout the pandemic, with extra emphasis on mortgage qualifiers such as credit score thresholds, maximum gross debt service ratio (GDS) and down payment requirements.
