The government has just announced major changes to mortgage rules that will significantly impact the Vancouver housing market. Here’s a breakdown of what you need to know:
- Expanded 30-Year Amortizations:
- First-time homebuyers AND buyers of new builds can now access 30-year amortizations on insured mortgages.
- This will significantly reduce monthly payments, making homeownership more attainable for a wider range of clients.
- Increased Price Cap for Insured Mortgages:
- The maximum purchase price for an insured mortgage has been raised from $1 million to $1.5 million.
- This opens up a whole new segment of the market, particularly for those looking at townhomes, semi-detached homes, and even some detached properties in Vancouver.
Key Points to Remember:
- These changes apply to high-ratio mortgages (loan-to-value ratio of 80% or more).
- First-time homebuyer definition is broad and includes those who haven’t owned in 4 years or experienced a relationship breakdown.
- New builds must be truly new, not previously occupied.
- These changes come into effect for applications submitted on or after December 15, 2024.
How This Impacts Your Business:
- Increased affordability for first-time buyers and those interested in new builds will likely stimulate demand in these segments.
- The higher price cap opens doors for clients who were previously priced out of the insured mortgage market.
- Be prepared for a potential surge in inquiries and be ready to guide your clients through these new opportunities.
If you care to read or refer to the news release from the government, go to https://www.canada.ca/en/department-finance/news/2024/09/delivering-the-boldest-mortgage-reforms-in-decades.html
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