KITCHENER -- There could be major changes on the way for the housing market, with Canada’s federal housing agency considering scaling back mortgage practices to limit the amount people can borrow.
The news comes as the agency predicts that house prices could fall as much as 18 per cent across the country
In a speech to the House of Commons on Tuesday, Evan Siddall, the CEO of the Canada Mortgage and Housing Corporation (CMHC), said scaling back borrowing rates by making down payments a minimum of 10 per cent would avoid exposing young people to losses from falling house prices.
The minimum down payment is currently five per cent.
CMCH is also concerned about higher mortgage debt with increased unemployment and declining house prices.
The Kitchener-Waterloo Association of Realtors say they remain optimistic that the region will be insulated, with the average single detached house price so far holding its value.
“The average sale price on a single detached home was $650,000, which is up 7.3 per cent over last year despite what’s happening in the marketplace,” says Colleen Koehler, president of Kitchener-Waterloo Association of Realtors.
“That’s only a three per cent drop in the March numbers, which was extremely strong even when we shut down after two weeks.”
Koehler acknowledges that no one can predict what is going to happen, but the market in the region has always been strong.
“We feel the region is in a position to weather this very well. I can tell you from my own experience, I still have first time home buyers trying to get into the market during this time,” she says.
The association also predicts that, with more people working from home, there could be more buyers from Toronto flocking to a more affordable market like Waterloo Region.
