First a Monday market update courtesy of Marko Juras.
|Wk 1||Wk 2||Wk 3||Wk 4|
|Sales to New Listings||
|Months of Inventory||
The latest round of mortgage tightening rules came in pretty weak. A 10% minimum down payment on mortgage balances over $500,000. For a city like Victoria, even if everyone was buying with 5% down, the median house would only require an extra $5000. Also expect rates to go up by a few tenths of a percent due to higher capital requirements for lenders. I suspect the impact will be completely imperceptible here. This was aimed squarely at Toronto and Vancouver, and even though the hit is more direct, it’s little more than a Nerf gun against those monster housing markets.
However this latest CMHC move to reduce risk and put a damper on the market shows that the new government has not lost the appetite for keeping a lid on the market. This is now the sixth move to restrict credit since 2008, and I’m willing to bet there is more coming if rates don’t increase soon. I have to hand it to the regulators, they seem to be doing a good job of carefully unwinding the excesses of the early 2000s without pulling the rug out from under the market.