Ottawa’s new rules creating ‘red hot’ market for homes under $999,999

Financial Post | Business

The hottest new Canadian housing-market niche isn’t stacked urban townhouses or suburban condo towers, but homes of any kind priced just shy of $1-million, since federal government rules began favouring homebuyers paying in the six-figure range over bidders that break the million-dollar mark.

[np_storybar title=”Fears of correction continue to haunt Toronto’s condo alley” link=”http://business.financialpost.com/2013/07/03/worries-of-crash-persist-in-torontos-condo-alley/?__lsa=9d0d-7271″]While many economists believe that Canada’s housing market will come in for a soft landing, Toronto’s condo industry still feels uncertain
[/np_storybar]

The market for homes under $1-million has become “red hot,” agents say, and that’s at least partly because new rules brought in by Ottawa last year make it impossible to get a loan backed by mortgage-default insurance if the property is valued in the seven figures.

The result: Bids for $999,999, or close to it, are increasingly common as even some wealthy would-be homeowners struggle to secure the necessary financing under new government rules.

“It’s…

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