Curbing mortgage credit growth is proving to be less profitable for Canadian homebuilders. “Ideally at this point the best thing would be for the new stress test to be repealed, just removed,” David Foster, director of communications at the Canadian Home Builders Association said.

As demand wanes and home prices slip, expect continued to pressure to mount from within the real estate industry. Ironically, home builders are calling for increased affordability but believe this can only be achieved from the supply side.

However, nobody has considered the housing boom may have been fuelled by an inflow of credit, which in turn created the job growth, wage pressures, and population inflows. All of which reverse when credit and housing contract...

There are several signs of credit contraction already, including Canadian mortgage credit growth dropping to an eighteen year low, and the global monetary base now shrinking for the first time since 2006.

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