Industry Responses To Mortgage Rules

The new mortgage rules become active tomorrow. For the record, here are a few recent responses to the changes:

“We should caution the minister to avoid precipitous actions that would undermine the stability of housing markets. We have stressed the important role our industry continues to play in Canada’s economic performance. There is a clear linkage between stable markets and Canadians’ financial well-being, for both homeowners and home purchasers. …
Having made these changes to mortgage rules, the minister has an obligation to monitor their impact very closely, in all housing markets across Canada. These regulatory actions paint all markets with the same brush, whether they are currently strong, balanced or weak.
We need assurances that the minister of finance will reconsider the new mortgage rules if the evidence shows the result in market instability.”

– from ‘Do the feds really ‘get’ new mortgage rule?’, Stu Niebergall, executive director of the Regina and Region Home Builders’ Association, Regina Leader Post, 23 Jun 2012

“History may look upon this pronouncement and call it Flaherty’s Folly. In the interim, many buyers will see it as more blood drained from their rosy dream of owning a Vancouver home.”
– Larry Yatkowsky, Vancouver Realtor,, 23 Jun 2012

“These changes, together with new OSFI underwriting guidelines… may precipitate the housing market downturn the government so desperately wants to avoid.”
– Statement, Canadian Association of Accredited Mortgage Professionals (CAAMP), 21 Jun 2012

“A change in the amortization period down by five years is going to affect most people’s buying power by $10,000, $20,000 or $30,000. In today’s housing market, that can be the difference between a really nice place and an average place. Most first-time homebuyers are trying to get into something they really like by pushing their limits.”
– Jeff Trounsell, Vancouver mortgage broker, Vancouver Sun, 22 Jun 2012

“Will this be enough to dampen the market? Maybe, but by own analysis not very much. I expect Flaherty’s move will prevent some on-the-edge buyers from making the leap too soon — but will do little or nothing to address affordability.”
Don Cayo, Vancouver Sun, 21 Jun 2012

For a measured analysis, read Robert McLister at Canadian Mortgage Trends, 23 Jun 2012:
“Despite the short-term pain and critical comments, it is clear that housing volatility will be reduced by these moves, over the long term. And that’s a positive…if you look far enough out.
The questions are, how long is long-term, how unpleasant are the side effects, and could those side effects have be minimized by a more incremental implementation?
Whatever the case, credit is due to the DoF, OSFI and Bank of Canada… they want to do the right thing.”

16 responses to “Industry Responses To Mortgage Rules

  1. “We need assurances that the minister of finance will reconsider the new mortgage rules if the evidence shows the result in market instability.”

    Where were these people when the rules were being loosened? Isn’t an extreme runup in prices an “instability” too?

  2. Thank you Vreaa for the effort you have made to bring these comments to our attention. I think we can all agree that no sane person wants to see a crash in our markets. At the same time it has become clear over the past months that action was necessary as housing consumers were failing to heed the legitimate warnings being issued from so many solid sources.

    So where does the line finally get drawn? It is a subjective measure without a doubt as none can see the real outcomes of excess until after it is too late. I applaude the recent moves by government to contain the growth in home prices even though it is clearly going to cause some hurt in the near term.

    We need to put aside the agendas of those who stand to benefit most from excess credit and also of those who stand to lose by having ignored the warnings thus far. It is in all of our best interests to cool the market and bring some shred of sanity back to the buying process.

    Canadians cannot afford homes anymore at the current prices and certainly not in an environment of global instability where there is a risk of rising unemployment and falling wages.

    The chill is most welcome and perhaps even overdue. Let’s embrace it.

  3. 4SlicesofCheese

    Cry me a f@ckin river.

    • Which means what in specific words, Cheese? You know you really have to make an effort to articulate yourself from time to time. What are you trying to say?

      • 4SlicesofCheese

        Meaning these people are bitching when rules are tightening because it affects their livelihoods and thinly try to disguise their motives as being on the side of the consumer and pretending to look out for them,

        Where were all these people when the rules were relaxed which effectively makes housing more “affordable” in the shortterm but kills the consumer with interest in the long run.

        Thats what I meant 😛

      • 4SlicesofCheese

        But for more thoughtful analysis and a more articulate delivery, comment-readers should definitely read the post above mine.

      • Thanks Cheese. I read the cursive comment as ripping into what I was writing instead of seeing it as a response to the article (only because it followed my remarks). Maybe I need a holiday from posting….feeling just a little touchy lately.

  4. those first-time homebuyers, are how old? age 30-32, average? Born when? 1980-82, when Interest Rates were stratospheric and ‘pushing their limits’

    it’s exactly this demographic; the banks, mainstream media, real estate agents, governments are all screwing over…. but do you find one instant when a reporter has the cajones to make the comparison? No, because their bread and butter is about screwing up these young adults. The bully boomer knows no other way to operate.

  5. Joe_Blown_Away_By_High_Housing_Costs

    paul S: I actually appreciate your astrological insights. You mentioned July 9 would be significant astrologically. I would appreciate any links to any discussion boards where you discuss that topic. Thanks.

  6. hello joe, I post a few astrological charts at, and at my last chart is But scroll the voy forum to read the commentary.

  7. i followed that post with more detail here…

  8. nothing says legitmate technical analysis quite like LOOKING AT THE STARS

  9. mortgage qualifying should have always been over max 25 years. We’ve just reset now to usual expectations.
    If the BOC thinks they’ve effected the housing market too much I’m sure you’ll see them slash .5% off the lending rate to compensate.

    • BOC is not charged to worry about mortgage rates. They are concerned about federal borrowing rates, for which they must compete internationally. The banks had their hands slapped for enticing unsuspecting consumers into a derivative market.

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