Jul 09, 2012
By Jane Brown
Empty nesters buying up condos will be among the home owners who will be affected by tighter mortgage rules. The new restriction goes into effect today as part of an effort to protect the economy by keeping Canadians from getting too far into housing debt. The maximum amortization period drops from 30 years to 25 years.
And lenders can only issue home equity loans up to a maximum of 80 per cent of a property’s value — down from 85 per cent.
Some analysts say if Toronto’s condo market wasn’t so hot, the changes would not be needed.
Last year, about 40 per cent of all new mortgages were amortized over 30 years.
But figures released just last week indicate the sizzling housing markets in Toronto and Vancouver are starting to cool.