How the new 10% minimum down payment works
We crunched the numbers to figure out the new graduated system for homes over $500,000
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We crunched the numbers to figure out the new graduated system for homes over $500,000
House Price | 2015 Minimum Down Payment Required | 2016 Minimum Down Payment Required |
$500,000 | 5% = $25,000 | 5% = $25,000 |
$800,000 | 5% = $40,000 | 5% on first $500,000 = $25,000 + 10% on next $300,000 = $30,000, for a total DP of $55,000 |
→ delay buying to save more
→ purchase a cheaper home
→ try and get secondary funding (either through the bank of mom and dad, or through higher-interest financing)
“There’s been a number of moves, over the last few years, in an attempt to regulate Canada’s housing market,” says Richards. “CMHC has already increased its mortgage default insurance premiums twice in 24 months; they’ve increased the down payment on homes worth $1 million or more to 20% and they increased the down payment made on rentals to 20%—and none of these changes have really cooled Canada’s two hot housing markets. Today’s announcement was a much less severe change, so it’s doubtful it will have a huge impact.” The Department of Finance released this chart that illustrates how the new minimum down payment breaks out: Read more from Romana King at Home Owner on Facebook »Share this article Share on Facebook Share on Twitter Share on Linkedin Share on Reddit Share on Email