Liberals stonewalling study of mortgage rules

Despite espousing to be great champions of the middle class, the Ottawa Liberals don’t seem too concerned with one of the most significant cost-of-living issues currently facing Canadian families — their mortgages.

In fact, that is the exact message the Liberals sent to Canadians when they voted down, on two separate occasions, motions before Parliament’s finance committee that would have studied the effects of the most recent and drastic changes to federal mortgage rules known as B-20.

On May 30, I forced debate on my motion to study recently implemented mortgage changes at the finance committee. Not one Liberal MP on the committee could muster up a single word during debate on the motion. Refusing to speak to my motion, every single Liberal MP voted down the proposal to study a defining issue facing middle-class Canadians — their mortgages.

Not satisfied with their refusal to take seriously the concerns of Canadians struggling with their mortgages, I tabled a second motion on June 13 — this time asking for a new subcommittee to be created that would study the new mortgage rules. Again, the Liberals said no, but at least debated the issue.

Dysfunction in the housing market has become the favourite justification for governments looking to change mortgage rules. But what happens when Liberal politicians meddle in the housing market?

In January, the Trudeau government, through the Office of the Superintendent of Financial Institutions, introduced a set of new rules titled B-20 that introduced a mandatory two-per-cent stress test for all qualifying mortgages.

Six months into 2018 and the harmful effects of these changes have already been realized. A recent CBC article reported that more than 100,000 Canadians would fail the stress test and that 50,000 Canadians would be blocked from purchasing homes.

Imagine tens of thousands of Canadians having home ownership yanked from their grasp. That is the reality that these changes have created. Canadians in every region are feeling the pinch. Data provided by Mortgage Professionals Canada indicates that up to 20 per cent more mortgages are being denied by banks since the changes were implemented. The huge dip in economic activity from the changes has caused the Bank of Canada to post the lowest mortgage growth in Canada since 2001.

History books tell us of the danger that can arise when governments neglect to enforce sufficiently stringent lending rules on financial insti- tutions. It was under the last Conservative government that Canadian banks — with strict oversight — weathered the 2009 financial crisis better than any other G7 country. However, regulation for the sake of regulation or, worse, misplaced regulation are not good policies. Regardless of the intentions behind the new mortgage rules, the effect has been catastrophic.

Outside of the decimated real-estate market, the far-reaching impact of the changes are also having an economy-wide effect with as many as 150,000 fewer jobs predicted, according to Mortgage Professionals Canada.

The Liberals’ refusal to study this issue should not be surprising. Over the past three years, Canadians have seen the Trudeau government take an Ottawa-knows-best approach to nearly every issue. The housing market is no exception. The Liberals have introduced more than a dozen regulatory changes to mortgage rules in three years, which evidently are not achieving much in terms of improving affordability or stability in the market.

Without the benefit of a comprehensive study, the true impact of these rule changes may never be known. However, when market indicators show home sales plummeting by as much as 20 per cent and huge segments of the population being forced out of the housing market, logic would indicate that further study is warranted. That’s precisely what I have asked for: An opportunity to study the effects the B-20 mortgage rules are having on Canadians. Sadly, the Liberals aren’t interested in getting more evidence.

As these Liberals continuously ignore the rising cost of living that Canadians are facing under their government, Conservatives will always take seriously the affordability concerns facing families.

Tom Kmiec, the Conservative MP for Calgary Shepard, is a member of Parliament’s standing committee on finance.