What is the expected impact of the new mortgage qualification rules ...

[TangoWhiskey]

Hi, I've searched through myreinspace and didn't find any discussion of the impact on investors of the new mortgage changes which just took effect to force qualification of high ratio buyers through an effective mortgage rate of 4.64 rather than the sub 3 rates prevalent. Am I missing it somewhere?? -it seems important to say the least. Robert McLister over at mortgagetrends (great website) estimates this policy change will have the effect of knocking 15-20 % of first time buyers out of the marketplace, which will likely have real impacts on price as the first time buyer pool is reduced in the short term at least.
Thoughts?
Where I am (Halifax) we have massive over development occurring in the order of several 000 new units per year beyond the actual demand - this new change to further reduce the limited number of first time buyers is expected to be very damaging to an already stressed marketplace in NS.
My own take is that this broad stroke national policy is likely to hurt sellers here this winter, which is great for buyers (me). It should also benefit RTO operators (also me) as the number of people looking for alternate financing arrangements increases.
Seasoned feedback appreciated. Thanks

 

[Thomas Beyer]

Less lending overall as CMHC is not available for all lenders anymore. Thus more B lenders with higher rates.

For sub 20% borrowers yes, roughly 20% less loan amount which means smaller houses/condos or none at all for them.

Overall a cooling effect, but more renters though !

 

[Matt Crowley]

Discussion on this thread: http://myreinspace.com/threads/thoughts-on-new-mortgage-rules-that-were-announced.36139/

It will decrease sales velocity and lock out a large number of buyers from the mortgage market.

 

[Tina Myrvang]

Hi, I've searched through myreinspace and didn't find any discussion of the impact on investors of the new mortgage changes which just took effect to force qualification of high ratio buyers through an effective mortgage rate of 4.64 rather than the sub 3 rates prevalent. Am I missing it somewhere?? -it seems important to say the least. Robert McLister over at mortgagetrends (great website) estimates this policy change will have the effect of knocking 15-20 % of first time buyers out of the marketplace, which will likely have real impacts on price as the first time buyer pool is reduced in the short term at least.
Thoughts?
Where I am (Halifax) we have massive over development occurring in the order of several 000 new units per year beyond the actual demand - this new change to further reduce the limited number of first time buyers is expected to be very damaging to an already stressed marketplace in NS.
My own take is that this broad stroke national policy is likely to hurt sellers here this winter, which is great for buyers (me). It should also benefit RTO operators (also me) as the number of people looking for alternate financing arrangements increases.
Seasoned feedback appreciated. Thanks

Read this interview by Don Campbell on October 21, 2016.
Read it HERE