Speculation is mounting that the federal government is moments away from taking a radical step in an attempt to cool off Canada’s scorching hot real estate market. According to the Financial Post’s sources, the feds have been studying proposals to increase the minimum down payment from its current 5 per cent. They are also reportedly looking at additional (as yet unspecified) restrictions for high-priced real estate to try to dampen the higher-end home frenzy in Vancouver and Toronto.
With interest rates falling even further than their already historic lows last week, which if anything is likely to further increase sales and prices, the possibility is becoming even more likely that Ottawa will take action.
“They are definitely looking into this but it doesn’t mean that they will do it,” one source told the Financial Post. Another source confirmed that Ottawa is continuing to look at increasing the minimum down payment.
The question is, would such a move actually succeed in guiding Canada’s real estate market into the feather-soft landing that many hope for and believe is necessary? The answer is, probably not.
