Ottawa announces new minimum down payments for homes over $500K

The federal government is increasing the minimum down payment required to buy a home for more than $500,000 in an effort to cool the red-hot housing markets in Toronto and Vancouver.

See Full Article

Finance Minister Bill Morneau made the announcement in Ottawa on Friday.

"We are looking at ways to ensure our market is stable and we want to make sure people are making the appropriate decision as they buy a new home," Morneau said during a news conference.

The new regulations will increase the minimum down payment from five to 10 per cent on the portion of the home's price that's greater than $500,000.

The minimum down payment on the first $500,000 of the home's price will remain at five per cent.

Morneau said the changes will impact one per cent or less of the housing market.

CTV News first learned of the tightening of mortgage rules on Thursday.

Canadians who already hold mortgages will not be affected by the new rules, Morneau said.

The new regulations will come into effect on Feb. 15, 2016.

Under the new rules, a $700,000 home would require a minimum down payment of $45,000. The $45,000 would consist of a five per cent down payment on the first $500,000 of the home, added to a 10 per cent down payment on the remaining $200,000 of the home.

Under the old mortgage rules, that same $700,000 would require a minimum down payment of $35,000.

Morneau said the new mortgage rules specifically target the Toronto and Vancouver's housing markets, where "prices have been elevated."

"We want to make sure we create an environment that protects the people that are buying homes so they have sufficient equity in their home," he said.


Latest Economic News

  • Can Facebook restore public trust after privacy scandal?

    Economic CTV News
    CHICAGO -- It's a scandal of privacy, politics and an essential ingredient of business success -- public trust. Facebook is confronting a costly, embarrassing public relations debacle after revelations that Cambridge Analytica may have misused data from some 50 million users to try to influence elections. Source
  • China tells U.S. it will defend interests after Trump tariffs

    Economic CTV News
    BEIJING -- China's newly appointed economic czar told U.S. Treasury Secretary Steven Mnuchin on Saturday that Beijing is ready to defend its interests after U.S. President Donald Trump announced plans to slap tariffs on nearly US$50 billion in Chinese imports. Source
  • The biggest loser in a trade war between China and the U.S.? It's you (but don't worry about it)

    Economic CBC News
    The old adage tells us no one wins a trade war. So, the next logical question is: Who loses? Well, the short answer is — you do. Consumers have been the clear beneficiaries of globalization. Cheap stuff has flooded into North America at a historically unprecedented rate. Source
  • What's being done with your data: Experts ask, shouldn't someone get this under control?

    Economic CBC News
    Now that Facebook, Google and Amazon know pretty much everything about us, how they're using that information is drawing the focus of politicians throughout the Western world, asking in effect: "Shouldn't something be done about this?" Source
  • Bombardier executive compensation hits US$33.4 million in 2017

    Economic CTV News
    MONTREAL -- Bombardier's executive compensation rose seven per cent to US$33.4 million in 2017, according to a circular released ahead of the company's May 3 annual meeting. The increase comes after a year marked by improved results, but also by the Airbus takeover of the C Series program without the company having to pay a single cent. Source
  • U.S. sets May 1 tariff threat on Canada, Mexico amid rush to speed up NAFTA talks

    Economic CBC News
    The United States has just applied additional pressure in its rush to get a new NAFTA agreement within several weeks, establishing a May 1 deadline, after which Canada and Mexico would face tariffs on steel and aluminum. Source
  • United Airlines gives $10,000 voucher to traveller on overbooked flight

    Economic CBC News
    A passenger who was bumped off a full flight has scored the maximum prize — a $10,000 US travel voucher. A spokesperson for United Airlines confirmed Friday that a passenger got the big voucher, but he didn't name the person. Source
  • Canadian retailers could be boosted by a U.S. trade battle with China

    Economic CTV News
    MONTREAL -- U.S. President Donald Trump's plan to impose tariffs on up to US$60 billion of Chinese imports could help Canadian retailers by further easing cross-border shopping, even though a full-fledged trade war between the world's two economic superpowers would damage Canada's economy, experts say. Source
  • CRA audits just 5 Canadians out of hundreds of RBC Panama Papers accounts

    Economic CBC News
    Two years after it took aim at hundreds of Royal Bank clients exposed in the Panama Papers leak, the Canada Revenue Agency has decided just five cases require an audit. That's because most of the offshore accounts it unearthed ended up belonging to foreigners, the CRA says. Source
  • Manulife mix-up: $170K retirement nest egg transferred from account without warning

    Economic CTV News
    A Toronto woman’s retirement nest egg was transferred out of her RRSP account after Manulife Financial wired more than $170,000 to a foreign third-party stock transfer company, putting the funds in limbo amid an ongoing spat with the financial services giant. Source