Winnipeg Home Buyers Facing Pressure
27th Feb 2017
New regulations for the Canadian housing market in 2017 are likely per a recent Reuters poll. Tougher borrowing policies are already putting pressure on Winnipeg home buyers.
Last fall, new housing regulations expanded stress tests making it harder for nearly 20% of new home buyers to qualify for mortgages. New federal measures also tightened mortgage insurance rules capital gains exemptions.
Despite these steps, 13 out of 20 economists polled by Reuters thought it likely local or federal governments will introduce new regulations in 2017 to continue to reign in housing prices.
For consumers, the confusing rules have led to higher borrowing costs and less borrowing power. It’s a more confusing process for borrowers searching for the right mortgage. Getting approval for a house at the best rates and terms is harder now.
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Starting in October of 2017, all insured mortgages are subject to a stress test rate based on the Bank of Canada’s posted five-year fixed rate (currently 4.64 per cent). The test ensures the borrower can afford the mortgage payments if mortgage rates go higher. The Bank of Canada rate is higher than the rate being offered by lenders and changes the price of a home most people can afford.
Winnipeg home buyers are having to change their expectations on a case-by-case basis. Each potential home buyer is facing stress tests to determine the economic viability of a new home purchase. Some home buyers may need to save more money for a larger down payment. Other home buyers may have to purchase less expensive homes.
The rule changes have led to a lot of uncertainty in the market. Home prices aren’t changing for the better so far. In Winnipeg, the average price for a home in January, 2017 was $272,553, a 2% increase over January of 2016, per the Canadian Real Estate Association.
It is crucial that buyers have someone who is on top of these changes and understands all the options available in the market to them. Today, a Mortgage Broker with multiple lenders is a great way for a buyer to ensure they are getting a proper mortgage for their unique situation.
Vertuity Mortgage works with a broad base of lenders to find the right mortgage for a customer. With nearly every potential borrower being affected by the mortgage rule changes, a range of borrowers is becoming a necessity. Vertuity Mortgage assesses each buyer’s needs and works to find the right mortgage. Recent rule changes mean the mortgage process is more complicated. Vertuity Mortgage walks every customer through a no hassle process to find the right mortgage.