Housing supply and unaffordability continue to impact the real estate industry across Canada. Home buyers need to see mortgage changes that allow flexibility and empower more choice. Lauren van den Berg, President and CEO of Mortgage Professionals Canada (MPC), joins TRREB’s Ready to Real Estate podcast host Jason Mercer to discuss the mortgage landscape and how MPC is working with all levels of government to implement reforms that will make homeownership more attainable for Canadians.  

Looking to buy or sell? Before getting started, it’s important for consumers to work with trusted professionals like a REALTOR® and a mortgage broker who can guide them. REALTORS® support their clients throughout the buying process and a mortgage broker is on hand to explore financial service offerings designed to fit a buyer’s budget.  

“By choosing a licensed mortgage professional, home buyers gain access to tailored financial advice and transparency, empowering them to make informed decisions,” explains Lauren.  

Understanding the Mortgage Stress Test  

If a buyer is exploring an insured mortgage, they will need to familiarize themselves with the Mortgage Stress Test. This is a way for banks and lenders to ensure consumers can afford their mortgages even if rates go up in the future. They will test at two per cent more than what they’re offered or the Bank of Canada’s benchmark rate – whichever is higher. This helps protect homeowners from financial trouble and ensures that lenders aren’t lending more money than borrowers can handle.  

A Changing Mortgage Landscape 

In this episode, we uncover what’s new and upcoming to the mortgage landscape. TRREB and MPC both support the Office of the Superintendent of Financial Institutions’ decision to remove the stress test at renewal. “The current rules limit a borrower’s ability to switch lenders which left them unable to adapt to changes in their financial situation, particularly in today’s high-interest rate environment,” said Lauren.  

This change provides Canadians with more control and the flexibility to find the best rates and terms to fit their financial needs. It also fosters friendly competition between lenders and encourages them to offer the best rates to consumers.  

We also saw reforms to amortization periods.  

Giving Canadians the choice between 25- and 30-year amortization periods is a game changer because this gives buyers more financial control when deciding to buy a home. “It’s all about giving Canadians their power of choice back and making homeownership much more attainable” added Lauren. 

Advocacy for Homebuyers and Sellers 

Recent housing policy changes are finally showing Canadians that housing is a top priority for all levels of government.  

Like TRREB, MPC is pushing for changes that can help put owning a home within reach. The Land Transfer Tax is a huge barrier for first-time home buyers because it’s a major upfront cost and not included in your mortgage. That’s why MPC is advocating for the deferral of land transfer taxes into installments to ease the financial burden of homeownership .  To learn more about the mortgage landscape and housing policies impacting the marketplace, listen to the latest episode on the Ready to Real Estate podcast.