The reactions to proposed changes in mortgage rules
Well, one much talked about development on the Canadian soil has been the latest announcement regarding the tightening of the mortgage rules and application criteria by the government. All classes and groups have been bothered by such an announcement. Here is a look into the reactions to the changes that seem to hinge on the spring market in Canada.
In fact, CAAMP—or the Canadian Association of Accredited Mortgage Professionals, has stressed on the point that it wants the government get all the facts right before it moves on to bring about changes in the mortgage rules. A number of studies have been conducted in this aspect and therefore, the President of CAAMP recently met up to discuss these results of the studies with the concerned authorities.
One important thing to take note of is that the mortgage rule changes are not in force immediately. It shall at least be spring before these new modifications are implemented. In fact, the citizens in Ottawa have taken to this pretty well and if the CAAMP President Murphy is to be believed, then the rule makers are actually interested in curtailing the credit growth. Since the year 2008, this would be the fourth round of rule modifications for mortgages.
All this is so much in the limelight owing to the important role that the housing sector plays in the economy of Canada. This is primarily because of the fact that this sector employs about 8 percent of Canadians. Since the year 2006, it has been solely able to create jobs for more than 18 percent of the workforce. Moreover, in the metro cities of Vancouver as well as Toronto, about 2 percent of houses sold are because of the investment values attached to each.
Therefore, in case the mortgage rules are implemented, there could be a fair impact on the sales section for the housing sectors. The economy might also face a lowdown owing to the downturns in a large degree- in the housing markets. CAAMP has been stressing on the fact that any decision that might lead to such a result should be avoided at all costs. Any such decision that shall lead to constraining of the activities of the housing market or that shall bring about a reduction in the capacity of authorities to proffer mortgage facilities to eligible home buyers, should be avoided.
It is some time more to realize the actual scale and intensity of implementation. The spring market after all shall lead to proper reactions of any changes.