CMHC not insuring luxury homes with sales price of more than $1M

This was announced about 4 months ago so it is no surprise – unless you have been sitting on a huge pile of cash and just now thought it is a good time to buy a home for $1,000,001 or more.

Another great example of rules that we have been working under for months that did not make the headlines …

CMHC no longer offering mortgage insurance for luxury homes

 Also cutting insurance to loans to finance condo projects
Canada Mortgage and Housing Corp. is making changing to mortgage insurance for luxury properties.

CALGARY – Canada Mortgage and Housing Corp. says it will no longer offer mortgage insurance for homes that cost $1 million or more, starting July 31, even if the buyer has made a deposit of 20 per cent or more.

It also announced on Friday that it will no longer insure loans that are used to finance construction of multi-unit condominium projects, effective immediately.

In Calgary, luxury home sales for the MLS market, for properties of more than $1 million, were 359 year-to-date until the end of May, representing three per cent of total sales activity. For the same period a year ago, there were 318 sales, still equating to three per cent of total sales.

Last year, a record was set with 727 MLS sales in the luxury bracket, representing 3.1 per cent of all residential sales in the city, according to the Calgary Real Estate Board.

“Consumers were already required to have 20 per cent down for million plus homes, and insurance was not required for these properties,” said Ann-Marie Lurie, chief economist with CREB.