In my last blog post, I highlighted the changes coming to the mortgage stress test. These changes were due to come into effect by April 6th, 2020. The Superintendent of Financial Institutions (OFSI) has announced these changes have been put on hold indefinitely.
This comes on the heels of the Bank of Canada’s emergency interest-rate cut on March 13th of 50 basis points, the second such cut in response to COVID-19. The new lower interest rates may have a similar effect that the planned stress test relaxation was intended for which may be the reason the OFSI has announced the suspension.
This rate cut has reduced the Bank of Canada’s lending rate to 0.75 per cent, the lowest since the global financial crisis in 2008.
Housing sales in Metro Vancouver climbed 44.9 per cent in February compared to the same month a year earlier and were up 36.9 percent from January. The composite benchmark price for a home is now $1.02 million, up 2.7 per cent from six months ago. These new rate cuts may help fuel an already heating-up housing market.
Whether you’re buying or selling real estate I’d love to help you navigate through these changes and help you obtain the best possible outcome. Please contact me if you have any questions or would like further clarification.
604 808 3797
– Dawar Zada PREC*