Welcome more brilliant new rules handed down from our friends in Ottawa, probably not to be the last we hear of rules and regulations by our ever so restrictive government.
New mortgage stress test rules are to come into play October 17, 2016. Meaning any buyer needing an insured mortgage will have to qualify at the 5-year BoC (Bank Of Canada) fixed posted rate which is currently, 4.64%. These stress tests are currently only required for borrowers who take on less than a 5 year fixed/variable rate term.
Also, on November 30, 2016, mortgage insurance criteria for low loan-to-value ratio mortgages (80 percent or less of the home value) will be as stringent as that for high loan-to-value insured mortgages (loans of 80 percent or more of home value).
Buyers/Borrowers should be moving quickly and securing a property now to not succumb to the irrational and inappropriate new mortgage rules starting October 17, 2016. Contact me - 416 888 5765 to try to find your new home ASAP.
Homeowners with existing mortgage or renewing their mortgage will not be affected as per Ottawa. However, I am now a little concerned that the above new rules may damper our beloved rural and suburban markets. **Call your bank or mortgage advisor for more details on the borrower rules and tax accountant for the below new tax rules.
The principal residence tax rules are being updated - but this is of less importance than the above. Surely, to be noted though. "To address the speculation in Vancouver and Toronto real estate partly fuelled by overseas money, the government also announced that a capital gains tax exemption on the sale of a principal residence will now only apply to those who live in Canada the year the home is purchased."
Information and article from: The Toronto Star