The federal government announced sweeping changes to Canada’s mortgage system in an effort to improve housing affordability and access.
For higher priced mortgage markets
One of the key changes is the increase in the CMHC-insured mortgage limit from $1 million to $1.5 million. This means buyers can now qualify for a mortgage with less than a 20% down payment on homes priced up to $1.5 million, making it easier to access higher-priced properties.
This move aims to help buyers in higher-priced markets where skyrocketing housing costs have made it nearly impossible for many to qualify for insured mortgages under the previous $1 million cap.
First Time Buyers
Another major reform is the extension of 30-year amortization periods to all first-time homebuyers. This expansion builds on the government’s announcement earlier this year to offer 30-year amortizations exclusively for new builds.
The government says this change will ease the financial burden on younger buyers, allowing them to spread payments over a longer period, thus reducing monthly costs. This will also assist with mortgage qualification. Check out my first time buyers web page here.
Both changes will come into effect December 15, 2024.
The announcement follows growing concerns about housing affordability. Deputy Prime Minister and Finance Minister Chrystia Freeland emphasized that these reforms are designed to unlock homeownership for more Canadians and address the ongoing challenges in the housing market.
“Building on our action to help you afford a down payment, we are now making the boldest mortgages reforms in decades to unlock homeownership for younger Canadians,” she said.
The government plans to introduce regulatory amendments to implement these mortgage reforms, with more details expected in the coming weeks.
If you have questions about your mortgage, how these changes may impact you or are currently shopping for a new home, please reach out to me today.
