First time home buyers are fucked: CMHC tightening rules

[ercchry]

If there is any good news though it’s that the other two insurers are not following cmhc’s lead... yet

[Buster]

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I’d assume OSFI says they can’t, but not sure. Above my pay grade haha

CMHC has to charge less than the market would charge to take on the risk of a mortgage portfolio. They basically say this outright.

I know you disagree that a mortgage portfolio represents any substantial risk, but the market disagrees with that, hence the need for the CMHC in the first place. The risk of a loss on a mortgage is very real. And if it is real for the banks who prefer to offload the risk than try to profit from it, then it is real for the CMHC.

So the taxpayer is subsidizing the difference.

Government backed mortgage insurance shouldn't exist at all, and the market should sort out the pricing of the risk.

[A790]

Super glad I paid $760k for an acreage in August... lol

[msommers]

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My condo has already dropped over 100k lol another 18% will bring it to about 400k. It is what it is! We all in the real estate boat together right

The airbnb ballers must be really feeling it rn.

Yeah my condo has realistically dropped about the same in value (actually 18.8% in real-world market prices). That's even without realtor fees

I suppose of any time to be unemployed in my life, right now is optimal given the various supports available.

AirBnB condo owners have got to be hurting like hell right now. Coupled with rising condo fees because of increased insurance costs...eesh.

Gotta take this shit one day at a time...

[riander5]

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No, I was planning last year to buy the forever, ever home with a substantial DP in the next few years, but less likely when the two properties that would be liquidated for the purchase keep eroding equity every year. Living like a middle class nobody FOREVER now

Ah I see... I own two rental condos im getting beat up on at the moment, but still managing to save a DP with a two year horizon on a home... if oil doesnt go -35 again things could work out well if you've got cash ready to go was my thought process.

[ercchry]

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CMHC has to charge less than the market would charge to take on the risk of a mortgage portfolio. They basically say this outright.

I know you disagree that a mortgage portfolio represents any substantial risk, but the market disagrees with that, hence the need for the CMHC in the first place. The risk of a loss on a mortgage is very real. And if it is real for the banks who prefer to offload the risk than try to profit from it, then it is real for the CMHC.

So the taxpayer is subsidizing the difference.

Government backed mortgage insurance shouldn't exist at all, and the market should sort out the pricing of the risk.

Yeah of course there is a risk, but we’re talking A clients here (shit, north of 680 beacon moving forward) and those defaults are historically low... even our defaults are low, we’ve committed on sub 4% rates this year... on very questionable people, no insurance

I think being government backed makes the recourse on these defaults way more rel than a private entity trying to recover any losses too, which isn’t even possible in this province

[rx7boi]

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Where y’all finding women to go 50/50?

Not on leolist and backpage, that's for sure.

[J-D]

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Ah I see... I own two rental condos im getting beat up on at the moment, but still managing to save a DP with a two year horizon on a home... if oil doesnt go -35 again things could work out well if you've got cash ready to go was my thought process.

I'll just be happy if I can ever sell the condo and not have to put money into the sale, let alone ever getting back my downpayment or equity. I wonder how many other involuntary landlords exist around the Calgary Condo market... lol

[riander5]

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I'll just be happy if I can ever sell the condo and not have to put money into the sale, let alone ever getting back my downpayment or equity. I wonder how many other involuntary landlords exist around the Calgary Condo market... lol

There must be a ton of us. I thought I was soooooo smart lol. If its not worth it in 10 years then ill really be mad!

[sabad66]

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I'll just be happy if I can ever sell the condo and not have to put money into the sale, let alone ever getting back my downpayment or equity. I wonder how many other involuntary landlords exist around the Calgary Condo market... lol

Landlord that never wanted to be a landlord checking in. Fml

[90_Shelby]

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Where y’all finding women to go 50/50?

Haskayne

[Buster]

have I ever mentioned that I hate residential RE as an asset class? lol

[ercchry]

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have I ever mentioned that I hate residential RE as an asset class? lol

Do you have to leave it at residential these days? Commercial hasn’t been hot (in this city) for a minute either

[ExtraSlow]

Great time to buy!

[rage2]

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Where y’all finding women to go 50/50?

I don’t find them. They find me.

[macman64]

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A couple years back the PEI gov rolled out a program for first time home buyers, they essentially loan you the 5% down payment.

https://www.princeedwardisland.ca/en...me-home-buyers

Loans on loans on loans babyyyyyy

I hope the liberals or anyone for that matter don't come up with a similar plan for the entire nation.

Calgary has been doing this for years. They just don't like putting it on the calgary website: https://attainyourhome.com/

[A790]

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Calgary has been doing this for years. They just don't like putting it on the calgary website: https://attainyourhome.com/

POD built that site.

[JRSC00LUDE]

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POD built that site.

POF built my rolodex.

[msommers]

TPS makes my reports.

[Misterman]

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Exposed to what financial situation. I moved out of the house after a sever family crisis with no money to speak of and worked my but off to buy a house I could reasonably afford, I just dont share the view of many, don't buy a house unless you are financially stable enough to afford it.

Like I do believe this will hurt the housing market, but I also think it is unreasonable to buy a home which is way outside your budget

The ignorance that wreaks from this thread is just disgusting. People who purchased homes a year ago, WERE financially stable enough to buy. The Government is now changing the goal posts.

If something happens in your life where you need money for medical bills, or some other unforseen emergency. You no longer have access to 20% of the equity you paid into your home, because the government has artificially devalued your home. I don't see how anyone could be so arrogant as to just be happy about this? God forbid someone tried to be responsible and made extra payments on their mortgage instead of investing in the stock market or something, then the government just steps in and steals money right out of your pockets.

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This was the point of these rules but it hasn't really worked. Most younger buyer are unable or unwilling to put 20% down and are willing to do a cmhc insured mortgage.

And the very simple solution to this as OP mentioned in first post, is to decrease TDS ratio. It's insane what they are trying to do with housing market. They are purposely cratering house values in an attempt to protect banks, and not addressing any of the real issues which is the housing bubble in TO and Vancouver. People can be just as leveraged personally, but they will be in cheaper houses. So risk of bankruptcy is just as high.