Peter Gilgan argues that the tightened mortgage qualification rules were too much of a good thing
Mattamy Homes founder and CEO Peter Gilgan is the latest industry player to weigh in on the need to repeal B-20.
The head of the largest residential homebuilder nationwide said that the regulations should be relaxed, or even eliminated altogether.
“Ownership is something that young Canadians aspire to, and I hear it all the time from people that they want to buy a house, they like the price that we’re able to offer them… but qualifying for that mortgage at two per cent over the actual rate is holding them back,” Peter Gilgan told BNN Bloomberg.
The much-tightened mortgage qualification rules introduced early last year have been roundly criticized by market observers and industry movers alike for being too punitive, despite helping moderate the country’s hottest markets.
“I think that [B-20] did a job, maybe a little too good a job of cooling the market. I think it’s time for [those stress tests] to go away,” Gilgan added.
Read more: Federal budget to introduce sweeping changes regarding housing
Gilgan also called for greater competition in the residential development sector, as monstrous delays between home construction and sales have become “bizarre and quite pervasive.”
“Imagine if you have to hold an asset for another 10 or 15 years,” he stated. “Your costs of holding that asset are significant, and that affects the input costs that you have to put into pricing the house.”
The executive further argued that intensified rivalries and arms races between builders will ultimately benefit the market long-term, and might even encourage greater purchase volume.
“I love to compete ... Let’s create more competitiveness in the real estate economy. We all know what competition is going to do. It’s going to bring prices down into a more affordable zone for more young Canadians.”
