The mortgage ‘stress test’ has started harming Canadians more than it helps

More debt not the answer: Watchdog says contentious mortgage stress test is safety buffer for banks and borrowers

Yet, lo and behold, the economy has started to soften, with GDP growth in 2019 pegged to grow by 2.2 per cent followed by a 1.9-per-cent increase in 2020, to say nothing about the volatility created by tariffs and trade woes. As such, the BoC is hitting pause on imminent rate increases. In other words, the context in which the stress test was introduced is no longer relevant. Interest rates aren’t anticipated to rise as originally anticipated, and homebuyers desperate to enter the market are seeking out unsecured lenders.

The bottom line is that the Canadian government needs to find ways to support, even incentivize, homebuyers in Canada rather than penalize them. While the stress test served its purpose early on, requiring homebuyers to qualify at a “stress rate” that’s two-per-cent higher than the actual rate on a 25-year amortization period is unproductive now that the market has normalized to more reasonable levels.

So I could make 200k a year but have a shopaholic wife, 300 dollar a month smoking habit, and go on 4 vacations a year. I'd be approved. Or make 70k a year and do nothing but work and go to the movies once in while but be denied. Government logic at it's best. Stay out of my $

I agree with the stress test for new buyers. As a renewer who never missed a payment, failing the stress test meant I couldn't shop around for a more affordable rate. Hurt me in the end. We should be grandfathered into this new policy.

Maybe some people shouldn't buy a house.

'Trapping young people into loans they will never pay off' has started harming Canadians more than it helps. Fixed it for ya

Canadians involved in the mortgage and construction industry. Yes. Christopher Alexander is executive vice-president and regional director of RE/MAX INTEGRA, Ontario-Atlantic Canada Enough said.

Why isn't the first word of this tweet OPINION: ?

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Deep freeze in housing market suggests mortgage rules have overshot their markHaider-Moranis Bulletin: A decline in sales in January 2018 was expected, the decline this January was disturbing Another Industry in the Tank Misleading title. Lose the stress test ....It's causing stress..
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