Winners and Losers of Canada’s New Government

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It is no surprise where the real winners and losers of the Trudeau-lead government lie. Throughout his campaign he talked about two things: the middle class and people wearing white lab coats. Since Trudeau was voted into office, billions of dollars have been spent on funding research projects in educational facilities and laboratories.

Image result for trudeau and real estate

Nevertheless, the true losers of a Trudeau government will ironically be those who helped get him elected; that is Millennials looking to buy their first house. The Liberal government made a decision in October to add a mandatory “stress test” for buyers. In effect the policy applies an added interest rate that is above market rates for mortgages backed by Ottawa. Experts suggest that the housing market is being kept afloat by buyers who were already pre-approved under the old laws. However, this will eventually come to an end and the negative effects of the new policy will soon take over. An Ottawa based Canadian Real Estate Association expect in 2017 house prices will effectively experience its first drop since 2008. For such declines in prices they have placed the blame solely on the Trudeau’s regulatory changes.

Many first time buyers will be shutout of the housing market as the purchase of their dream home becomes less attainable. Economist fear a drop in demand will decrease house prices, which will in turn trigger a nationwide crash in the economy. Furthermore, at a time of high mortgage indebtedness, the economy is ripening for a possible economic meltdown.  



Taken from an article by the National Post, written by John Ivison.

http://news.nationalpost.com/news/canada/canadian-politics/ottawa-scorecard-2016

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