On Tuesday, industry group Mortgage Professionals Canada (MPC) raised some issues regarding the stress test, specifically its capacity to deter many Canadians from the home market. For this reason, the association is asking the government to reassess such policies.
While the government's good intentions regarding these regulations were acknowledged, MPC said that there is a need to address the condition of many Canadians – millennials, single parents, or recent immigrants – who are seeing increased difficulties when it comes to in owning a home.
"Fewer Canadian now are able to obtain the mortgage they need to acquire a home, and many sellers now find fewer buyers to sell their home too," said MPC President and CEO Paul Taylor.
“As we first outlined at the time of the mortgage rule changes, it's now clear that our concerns regarding the cumulative impact of said changes are decreasing competition and increasing costs for consumers."
Leaders of the national mortgage industry association are set to meet with more than 50 Members of Parliament and senior government officials and inform decision-makers on the continued negative impact of the stress test. MPC will also be discussing problems relating to housing affordability, availability and accessibility, along with the fact that recent federal mortgage rule changes are burdening Canadians.
Backing up their concerns with data, MPC hopes that the government makes necessary adjustments moving forward.
"We have outlined five clear asks that reflect the growing national evidence being felt by Canadians from coast to coast, which includes uncoupling the 'stress test' from the Bank of Canada 5-year benchmark rate and be set to 0.75% above the contract rate set by the lender, as well as changes to the B-20 'stress test,'" said MPC Board Member Mark Kerzner.
"We ask that the government reconsider and recalibrate these policies to ensure the Canadian Dream is as achievable for this generation as it was for their parents and grandparents.”