Quote:
Originally Posted by ken0042
Holy crap! What happens if somebody bought a place intended for a rental last month, but it isn't scheduled for completion until 2011? They would need to come up with the other 15% down, or lose the 5% they already put down on it?
I saw a little bit about this on the news, and the finance minister was talking about how Canadians are doing better than the rest of the world with repect to fewer mortgage defaults. I didn't think by the way he was talking that the gov't was going to stick its nose into our business more than it needs to.
Seriously, who does this help aside from CMHC?
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That's inherently the problem we find ourselves with in Canada, government intervention. The CMHC/Government has allowed the banks to lend without risk, which has prevented true free market forces from taking hold.
Basically, what we have here in Canada now is a gigantic socialized housing bubble. Higher interest rates would help deflate the bubble, and let the healing begin, but would wound the large numbers of people that have been viewing their purchase based on monthly payments instead of a soul crushing amount of debt.
So the government's alternative, stricter regulations, gives them the political wherewithal and ability to say, 'Hey, we tried' without actually raising the lending rates before their promised mid 2010 date.
Unfortunately it's all a case of far too little, far too late.