{"id":12105,"date":"2019-04-08T10:10:52","date_gmt":"2019-04-08T17:10:52","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=12105"},"modified":"2019-04-05T10:16:11","modified_gmt":"2019-04-05T17:16:11","slug":"the-impact-of-tougher-mortgage-rules-to-bcs-housing","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2019\/04\/the-impact-of-tougher-mortgage-rules-to-bcs-housing\/","title":{"rendered":"The Impact of Tougher Mortgage Rules to BC&#8217;s Housing"},"content":{"rendered":"<p style=\"text-align: justify;\">To demonstrate how BC home sales activity has dropped off in the 14 months after policymakers changed the qualification process for uninsured mortgages, a provincial real estate association has drawn a line in the sand \u2014 or rather, a chart.<\/p>\n<p style=\"text-align: justify;\">With the release of the British Columbia Real Estate Association (BCREA)\u2019s February home sales statistics earlier this month, the industry association included the chart, giving a before-and-after look at seasonally adjusted BC home sales, which plummeted 27 percent last month on a year-over-year basis.<br \/>\n<a href=\"https:\/\/www.roryc.ca\/blog\/?attachment_id=12106\" rel=\"attachment wp-att-12106\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone  wp-image-12106\" src=\"https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/03\/BC-chart-288x203.jpg\" alt=\"\" width=\"606\" height=\"427\" srcset=\"https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/03\/BC-chart-288x203.jpg 288w, https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/03\/BC-chart.jpg 762w\" sizes=\"auto, (max-width: 606px) 100vw, 606px\" \/><\/a><br \/>\n\u201cProspective homebuyers continue to be sidelined by the mortgage stress test,\u201d says Brendon Ogmundson, BCREA\u2019s deputy chief economist, in a news release. \u201cAs a consequence, and despite a strong BC labour market, sales remained slow in February,\u201d Ogmundson.<\/p>\n<p style=\"text-align: justify;\">Last January, federal policymakers expanded mandatory stress testing to the uninsured mortgage segment. The rule change meant that even if a borrower was able to cobble together a downpayment of 20 percent \u2014 thus not requiring mortgage insurance \u2014 they\u2019d still be need to qualify at a rate 200 basis points higher than what their bank was offering. Insured mortgage applicants already faced stress testing.<\/p>\n<p style=\"text-align: justify;\">BC home prices have also taken a hit since the federal policy was implemented. The average selling price of a residential property in the last month was $678,625, down 9.3 percent from a year prior.<\/p>\n<p style=\"text-align: justify;\">Ahead of the release of the Canadian federal government\u2019s budget, which was unveiled on March 19th, Justin Trudeau\u2019s Liberals faced calls to relax the stress tests.<\/p>\n<p style=\"text-align: justify;\">No such change appeared in the 2019 budget, although a number of other items focused on housing affordability did.<\/p>\n<p style=\"text-align: justify;\">These items include raising the maximum amount a first-time homebuyer can draw from their RRSP to finance the purchase, to laying out plans for a shared-equity mortgage scheme that would see the Canada Mortgage and Housing Corporation get a stake in a first-time homebuyers property in exchange for some downpayment financing.<\/p>\n<p style=\"text-align: justify;\">\u201cWhile we welcome the incentives for first-time home buyers, the announced measures fail to address the damage done by the mortgage stress test,\u201d says BCREA in a separate response to the budget.<\/p>\n<p style=\"text-align: justify;\"><a href=\"https:\/\/www.livabl.com\/2019\/03\/bcs-housing-market-slumped-since-tougher-mortgage-rules.html\" target=\"_blank\" rel=\"noopener noreferrer\">This Chart Shows How Far BC&#8217;s Housing Market Has Fallen Since Tougher Mortgage Rules Were Introduced<\/a> by Josh Sherman | Livabl<\/p>\n","protected":false},"excerpt":{"rendered":"<p>To demonstrate how BC home sales activity has dropped off in the 14 months after policymakers changed the qualification process for uninsured mortgages, a provincial real estate association has drawn &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2019\/04\/the-impact-of-tougher-mortgage-rules-to-bcs-housing\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-12105","post","type-post","status-publish","format-standard","hentry","category-mortgage"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>The Impact of Tougher Mortgage Rules to BC&#039;s Housing &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2019\/04\/the-impact-of-tougher-mortgage-rules-to-bcs-housing\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"The Impact of Tougher Mortgage Rules to BC&#039;s Housing &#8226; 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