Mortgage Rules Exclude New Homebuyers, as Intended
One in five first-time buyers say last year’s mortgage rule tightening made them wait longer to buy, according to a just re-released BMO poll. That’s just what the Finance Department wants to hear.
That stat is in the ballpark of CAAMP’s fall finding that 16.9% of high-ratio borrowers from 2010 would not have qualified under today’s rules.
Meanwhile, despite fewer first-timers, average prices keep making record highs. It’s hard to kill demand with sub-3% mortgage rates being so plentiful (albeit, no longer on fixed terms over four years).
Moreover, while some expected new listings to be flooding the market by now, that’s clearly not happening on a national basis. Most homeowners refuse to be scared into selling by all the housing bubble and mortgage rule talk. Nationwide inventories have been dropping for three months in a row.
Other stats from BMO’s release:
2012 mortgage rules made one-third of first timers in pricier B.C. wait longer to buy
The average price first-timer buyers expect to pay for their home: $300,000
The average first-time buyer’s down payment: $48,000 (16%)
As noted in April, we still have trouble believing that last number ($48,000) because:
Past data from Genworth found the most common down payment for first-timers was just 5.0% to 9.9%
RBC’s recent Homeownership poll found that 62% of fledgling buyers planned to put down 10% or less
CAAMP found that only 11% of renters had $30,000+ for a down payment.
Rob McLister, CMT
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