{"id":55,"date":"2016-03-30T21:08:19","date_gmt":"2016-03-31T01:08:19","guid":{"rendered":"http:\/\/www.dinani.ca\/blog\/?p=55"},"modified":"2016-03-30T21:08:19","modified_gmt":"2016-03-31T01:08:19","slug":"experts-say-new-mortgage-rules-will-affect-only-a-few-buyers-in-vancouver","status":"publish","type":"post","link":"http:\/\/www.dinani.ca\/blog\/2016\/03\/30\/experts-say-new-mortgage-rules-will-affect-only-a-few-buyers-in-vancouver\/","title":{"rendered":"Experts say new mortgage rules will affect only a few buyers in Vancouver"},"content":{"rendered":"
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\"Experts<\/div>\n
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New mortgage rules are likely to affect only a small group of buyers int he hot Vancouver housing market, experts say.<\/em><\/span><\/div>\n
Photograph by:\u00a0<\/strong>Gerry Kahrmann , Vancouver Sun<\/em>\u00a0<\/em><\/span><\/div>\n<\/div>\n<\/div>\n
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Some prospective home buyers could be squeezed out of the Metro Vancouver market by new federal mortgage rules, but only those looking to get in with razor thin down payments, experts say.<\/span><\/p>\n

Boosting down payments on certain homes could delay some buyers\u2019 purchases, but it is unlikely to cause a severe downturn in the market, said Cameron Muir, a chief economist at the B.C. Real Estate Association.<\/span><\/p>\n

About 35 per cent of Metro Vancouver home sales are in the $500,000 to $1 million price range that the federal government targeted with its rule change.<\/span><\/p>\n

\u201cIt is a fairly significant number of homes, but people buying $800,000 dollar homes typically aren\u2019t putting down razor thin down payments of five per cent and carrying that kind of a mortgage,\u201d Muir said.<\/span><\/p>\n

\u201cFirst-time buyers,\u201d he said, \u201ctend to buy at the lower end of the market place, so for them it wouldn\u2019t be much of a change.\u201d<\/span><\/p>\n

Muir characterized the federal move as \u201clonger-term risk mitigation.\u201d When asked if it was a good idea, he said \u201cit\u2019s the least worst measure they could implement right now.\u201d<\/span><\/p>\n

Tom Davidoff, an associate professor at UBC\u2019s Sauder School of Business, said increasing down payments to qualify for a Canada Mortgage and Housing Corp.-insured mortgages was a smart move.<\/span><\/p>\n

\u201cYou\u2019re hedging against the risk of a home price decline, which is sensible for an insurance company,\u201d Davidoff said.<\/span><\/p>\n

\u201cI don\u2019t know if house prices are going to fall from where they are here \u2014 it\u2019s very hard to forecast home prices especially in a place like Vancouver or Toronto, where it\u2019s not so easy to add new supply \u2014 but there\u2019s certainly a risk that prices will fall,\u201d Davidoff said.<\/span><\/p>\n

\u201cYou don\u2019t charge a lot of money for each home insurance policy. If a buyer was to default, that\u2019s CMHC\u2019s problem.\u201d<\/span><\/p>\n

Davidoff said if five or ten per cent of people in the market were taking on five per cent equity loans \u201cthis could really cool things down.\u201d But without seeing CMHC\u2019s numbers, \u201cmy impression is that\u2019s a smaller part of the market and therefore it\u2019s not likely to have a huge effect,\u201d he said.<\/span><\/p>\n

On the listings side, the change could lead sellers in Canada to price homes that are around the $500,000 mark more strategically \u2014 perhaps listing just under a half-million dollars, Davidoff said.<\/span><\/p>\n

Neither Muir nor Davidoff could immediately say how many homes in the region would be affected by the change or where they are primarily located. To get a rough picture of the impact, The Sun ran through the region\u2019s active MLS listings Friday afternoon.<\/span><\/p>\n

About one-quarter of Vancouver homes listed on MLS fell within the $500,000 to $1 million range, including 13 single-detached homes, 15 duplexes, 44 townhouses and 285 condos.<\/span><\/p>\n

About 21 per cent of Burnaby homes on MLS, and 25 per cent of Richmond and North Vancouver homes fell in that price range. Most homes in those cities in that price range were apartments or townhouses. Moving further east, the proportion of single-family homes available in that price range increases. Most of the 39 Port-Coquitlam homes listed in that price range were single-detached houses, as were the bulk of the 661 in Surrey, 106 in Langley and 179 in Abbotsford.<\/span><\/p>\n<\/div>\n

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Read more:\u00a0http:\/\/www.vancouversun.com\/business\/experts+mortgage+rules+will+affect+only+buyers+vancouver\/11583924\/story.html#ixzz3uUTkSrXJ<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

New mortgage rules are likely to affect only a small group of buyers int he hot Vancouver housing market, experts say. Photograph by:\u00a0Gerry Kahrmann , Vancouver Sun\u00a0   Some prospective … [read more<\/a>]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[14],"tags":[],"_links":{"self":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts\/55"}],"collection":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/comments?post=55"}],"version-history":[{"count":1,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts\/55\/revisions"}],"predecessor-version":[{"id":56,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/posts\/55\/revisions\/56"}],"wp:attachment":[{"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/media?parent=55"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/categories?post=55"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.dinani.ca\/blog\/wp-json\/wp\/v2\/tags?post=55"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}