In an effort to make homeownership more attainable for Canadians, the federal government has announced further enhancements to the revised Canadian Mortgage Charter announced in the 2024 budget.
The revised Canadian Mortgage Charter which took effect on August 1, the first-time purchasers of newly built homes benefited from extended mortgage amortization periods of up to 30 years.
Today, Chrystia Freeland, Deputy Prime Minister and Minister of Finance, detailed further extension of the eligibility for 30-year mortgage amortizations to all first-time homebuyers and all buyers of new builds effective December 15, 2024. The federal government says this extension aims to reduce the burden of monthly payments, making it easier for new homeowners to manage finances as they ascend their career ladders.
Additionally, in response to escalating housing prices in urban centers like Toronto and Vancouver, the government has raised the insured-mortgage price cap from $1 million to $1.5 million. According to the federal government, this will allow more Canadians to secure mortgage loan insurance with down payments of as little as 5% while securing reasonable interest rates starting December 15.
As per the news release:
- To be considered a first-time homebuyer, a borrower must meet one of the following criteria:
- The borrower has never purchased a home before
- The borrower has not occupied a home as a principal place of residence that either they themselves or their current spouse or common-law partner owned in the last for years or has recently undergone a marital or common-law separation, aligning with Canada Revenue Agency guidelines.
- To be considered a new build:
- The new home must not have been previously occupied for residential purposes.
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These new mortgage decisions are not going to make a huge difference for low-cost living. Also, extended mortgage amortizations could push home prices higher.
People cannot find AFFORDABLE places to live and they require purpose-built apartments immediately. Furthermore, incompetent city pilot programs ADD to the unaffordable rental debacle.
Mississauga Ward 7 city councillor Dipika Damerla claims it was “her idea” for MARC mandatory inspections of apartment buildings, however, Dipika Damerla’s mandatory inspections could create RENT INCREASES from landlord capital-cost AGI’s making rents less affordable for tenants.
Mississauga councillor Brad Butt stated that MARC could result in “above the guideline rent increases at a time when affordability of rent is paramount.” Daryl Chong (GTAA) explained landlord capital costs are “eligible for AGI’s.” Brad Butt and Daryl Chong agreed that onerous MARC inspections and regulations could DISCOURAGE developers from purpose-built apartments in Mississauga which are urgently needed. City Council Meeting Mar 27/2024 (Public Information)
Ontario city councils need to focus on incentives for purpose-built affordable apartments and not adverse MARC programs that could HIKE rents from AGI’s.