If I were the Finance Minister, I’d also “scold” the banks publicly first, before dishing out another round of mortgage tightening. Perhaps Flaherty is unusually targeting “mortgage wars” to portray the banks as the “bad guys”, while stating the very next day that he did it out of “concern for the Canadian people“.
Increasing the qualifying rate of insured mortgages to “6%” (or say, 5-year-fixed-rate Plus x%) could also be a logical rule change by the Finance Minister (beside tinkering with down payment req / amortization / debt ratios)
A member at a RE forum also stated "according to his friends involved with big bank mortgage underwriting",
“CMHC has already made additional changes to their guidelines in the last couple of weeks. Deals that were automatically rubber stamped are now being reviewed with a fine tooth comb and/or declined, the latter of which are being shuffled off to Genworth now.”
Perhaps further rule changes were indeed the weapons that Flaherty’s threats were backed with.
Another topic: ever wonder why some properties are listed on MLS as “Sold with 0 day on market”? A realtor said “I suspect that realtor has sold it first and only placed it on MLS for Medallion points at the Board”.
The reason I found this interesting was because some pumpers were using the “sold with 0 day on market” as a sign that things are heating up with bidding wars again. Those Medallion points are indeed hard to come by in this poor market ; )