Housing market showing signs of cooling
Canadian home sales activity slowed in August, the month after moves by the federal government to tighten mortgage lending standards took effect.
After the Canadian Real Estate Association (CREA) released statistics for the month of August showing a significant slowdown in home sales, many are believing the Canadian housing market is beginning to cool. The report, released last week, shows that home sales had fallen by 5.8% from July to August 2012. It is the hope that the decrease in sales activity will have a positive effect on the Canadian economy and banking system, according to a representative from Fitch Ratings.
The slowdown seems to be driven in large part by new mortgage legislation that came into effect in July, boosting applicants in the time between the announcement and implementation of the rules. The changes, including lowering the maximum amortization period and increasing debt service ratios, are making it more important for mortgage applicants to pay close attention to their credit ratings, and perhaps strive for a larger down payment. However, home ownership is still within reach for first time buyers. Contact an Ottawa Mortgage Broker for more information.
Click here to read the full article from the Financial Post.