Lintott Law
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The mortgage stress test and the future of real estate

It's no secret that very few individuals have anything good to say about the federal government's mortgage stress test. Many Alberta residents -- and others in the country poised for buying real estate -- were set back when the test was introduced at the beginning of 2018. The test has impacted the market in a number of ways, one of which includes a market decline.

The test, which eliminates high-risk buyers from the market, has created some sluggishness. Obviously, if there aren't enough buyers, many properties will sit and that doesn't bode well for the overall economy. Mortgages have decreased by 8% over the same time last year and the stress test, experts say, is partly the culprit. Banks have been the only fans of the test, but even the larger financial institutions are now admitting the test may have hit potential homebuyers hard and may need revisiting.

That leaves the question, what should happen to the stress test? Chief banking economists believe it should be restructured to better reflect buyers' needs and circumstances. Those who earn an average wage still find themselves out of reach of homeownership. Although those connected to the real estate market believe something should be done with the test, no insights have been given as to what changes should entail.

Even with the federal stress test in place, real estate continues to move around the country. Alberta residents poised to either buy or sell property may find the help of an experienced lawyer to be beneficial. A lawyer's part in a real estate transaction includes everything from advising a client on a contract, to title searches and preparing transfer documents. A lawyer will ensure that all transactions move forward according to the letter of the law.

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Lintott Law
2913 Centre St N.W.
Calgary, AB T2E 2V9

Phone: 403-879-1613
Phone: 403-520-2288
Fax: 403-230-3477
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