Tuesday, October 5, 2010

Ottawa ponders further tightening of mortgage rules

Garry Marr and Paul Vieira, Financial Post · Sunday, Oct. 3, 2010

TORONTO/OTTAWA • The federal government is once again looking at tightening rules in the Canadian mortgage market, according to a source close to the situation.

Finance officials are set to meet in Ottawa on Monday with some of the country’s leading economists for pre-budget discussions and the subject of whether to tighten housing regulations may come up.

Much of the discussion about changing the mortgage rules seems to stem from comments made by the Bank of Canada governor who last week warned that consumer borrowing could not continue at its present clip.

“Canadian household balance sheets are becoming increasingly stretched,” said Mark Carney, who issued a warning to legislators about taking steps to contain the growth of personal debt. “Historically low policy rates, even if appropriate to achieve the inflation target, create their own risks.”

Read more: http://www.financialpost.com/news/Ottawa+ponders+further+tightening+mortgage+rules/3617608/story.html?goback=%2Egde_3292750_member_31274731#ixzz11XmMvZ3C

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