The national average home price just broke another record, hitting $391,820 according to CREA. That will not go unnoticed in Ottawa.
Speculation could now build as to whether the Department of Finance will restrict mortgages further in order to slow the market.
We’d submit, however, that there is no need to wonder if we’ll get new mortgage restrictions. It’s a given that more regulations are coming. The only questions are what rules to expect and when.
One area facing potential rule changes is mortgage securitization. It’s an esoteric topic for the average consumer, but one that could directly affect his or her finances.
Last month, the Department of Finance confidentially circulated a discussion paper to lenders. In it were ideas on further restricting securitization and mortgage insurance. Some of the policies, if enacted, could disproportionately disadvantage smaller lenders, impede competition and drive up mortgage rates.