There has already been “some softening” in the Canadian real-estate market so there is no need for further tightening of mortgage rules, Finance Minister Jim Flaherty said Tuesday.
In his first public comments since the election, Flaherty said the country continues to weather the ongoing upheaval in the global economy. He said his first priority is to deal with the budget — which will likely be presented in June — in order to continue to implement his government’s economic action plan.
Unlike the United States and Europe, the Canadian housing market has continued to rise after the financial crisis, leading some observers to caution we could be headed for a bubble.
Flaherty said he’s already intervened to toughen mortgage rules three times in the last few years and there’s no need for further action as conditions in the market are finally moving in the right direction.
Flaherty said he does not believe there were any unintended consequences in the housing market resulting from government intervention in the mortgage business during the financial crisis to keep banks lending money.
Still, he said his government keeps a close eye on the housing market and subsequently stepped in three times with changes to mortgage rules when there were concerns about risk.
Flaherty said his government will present a slightly revamped budget in June. It will be changed to reflect an economic update and may include some items from the election platform, but will be largely the same budget he presented in March, he said.