Real estate associations representing nearly three-quarters of the realtors in Canada have called for federal parties to commit to ease mortgage rules as the election campaign gets underway.
Organizations representing realtors and brokers in Toronto, Vancouver, Calgary, Edmonton, Quebec and Nova Scotia say too much regulation makes ownership unaffordable.
With the federal election set for Oct. 21, the boards and associations have urged federal political parties to commit to revise the mortgage stress test and adapt it to regional differences and changing economic trends.
The stress test, made more stringent in 2018 to cool an overheated housing market, requires would-be borrowers to show they could still make payments if faced with higher interest rates or less income.
The associations also want the $750 First-Time Home Buyers Tax Credit replaced with a $2,500 non-refundable tax credit for first-time buyers and are seeking reintroduction of 30-year mortgage amortizations.
Industry groups have been calling for eased rules around home buying for some time, while the CEO of the Canada Mortgage and Housing Corp. has urged the federal government to keep the rules in place to protect the economy from tragic consequences as debt levels soar.
CMHC head Evan Siddall urged in a letter to a federal committee in May that it look beyond the “plain self-interest” of groups advocating for eased rules and see the lowering of home prices as helpful for the long-term health of the economy.
Ashley Smith, president of the Real Estate Board of Greater Vancouver, said in Thursday’s release that her association believes in responsible lending and regulation, but also wants to see a balance.
“The stress test is causing more harm to hopeful home buyers than it needs to. It’s hurting affordability and stifling people’s ability to meet their housing needs.”
John DiMichele, CEO of the Toronto board, also called for more measures to increase supply, including relaxed rules on mid-density buildings, less red tape, and help on transit-oriented development.
“We need concrete results in the Greater Toronto Area to address the lack of supply.”
Matt Honsberger, president of the Nova Scotia Association of Realtors says no two real estate markets are the same and the inflexible stress test as well as other housing policies ”are simply not solutions that will work across our diverse country.”
The Canadian Press