Ottawa announced today they are proactively going to change mortgage rules to limit risks to Canadian homebuyers in the event interest rates begin to rise and mortgage costs increase. Speculation in Toronto Condominiums will be limited by a new requirements for a 20 per cent down payment for properties the buyer will not be living in. Real Estate speculation in the Toronto and Vancouver Condo markets can drive prices to higher levels and as a result other buyers drop out of the market.Other mortgage amendments announced:
- Homeowners limited to 90 per cent of the value of their home for mortgage refinancing
- 20 per cent down-payment (four times the current requirement)
- Borrowers to meet standards for a five-year fixed-rate mortgage even though they elect for a shorter term and rate
All of these new rule changes are to come into effect April 19, 2010.