Ottawa implemented the regulatory changes—which included stipulations that require all insured mortgage holders to qualify at the five-year Bank of Canada rate—in its efforts to cool down the country’s most overheated real estate markets, the Toronto Star
The measures also mandated tighter tax exemption laws for real estate along with “stress tests” on all new insured mortgages, steps intended to reduce the risk of overwhelming debt burdens among consumers.
The Toronto Real Estate Board said that it will take some time for the effects of the new rules to manifest, which is why monitoring them is crucial.
“Any time you're seeing policies that could influence the demand, there's a few different ways it could play out,” TREB director of market analysis Jason Mercer. “In the past, we've seen a mix where some households may take a step back and temporarily reassess their situation, others may look at different housing types or different areas to purchase a home.”
Fresh figures from TREB revealed that housing transaction volume grew by 21.5 per cent year-over-year in September, up to 9,902 sales. Average home prices in the city also rose from $750,549 to $764,872 in the same time frame.
New housing measures announced
Report: Ottawa to close tax loophole amid reports of abuse of home ownership rules
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With the Toronto housing market seeing a surge of sales activity and price growth last month, the city’s real estate council announced that they will be looking closely at the impact of the new measures introduced by Finance Minister Bill Morneau earlier this week.