Forecasts in CMHC's Housing Market Outlook
released for Spring 2020
indicate that the average MLS® price will decline by 9% to 18% from its pre-COVID-19 levels before beginning to recover in the first half of 2021,
reflecting the negative outlook for impacts on income and employment. Siddall said
COVID-19 has exposed longstanding financial-market vulnerabilities, and "we must act now to protect the economic futures of Canadians."
Changes to CMHC mortgage insurance eligibility requirements as of July 1st:
- A minimum credit score of 680 instead of the current 600
- The maximum GDS (gross debt service) moves from 39 per cent to 35 per cent and the maximum TDS (total debt service ratio) from 44 per cent to 42 per cent
- Homebuyers no longer allowed to use borrowed funds for their down payment
Mortgage insurance is mandatory in Canada for loans with a down payment of less than 20 per cent. There are private insurers, but none (as of 06-16-2020) have publicly announced adoption of CMHC's new numbers.
CREA and other industry stakeholders continue to work with CMHC to advocate for support for home owners and those who wish to become home owners.