TECHNOLOGY @ RBC

- Legislation and policies – promoting a healthy Canadian housing market July 2020-CMHC ■ Minimum credit score for CMHC insured mortgages raised from 600 to 680 Gross debt service ratio reduced to 35%; total debt service ratio reduced to 42% to qualify for CMHC insured mortgage CMHC tightened rules on admissible down payment sources April 2020 (postponed due to COVID-19) – Department of Finance The benchmark rate used in the insured mortgage qualification stress test changing to the median contract rate on all insured mortgages, making the stress test more responsive to actual market rates. OSFI is considering a similar change for uninsured mortgages February 2018 – Government of British Columbia The B.C. government introduced a 30-point plan to address housing affordability issues. It included a new speculation tax (2% of assessed value) on homeowners who do not pay income tax in the province and increased in the foreign buyer tax to 20% from 15% January 2018 - OSFI Qualifying rate for uninsured mortgages raised to 2 percentage points above the contract rate or the five-year posted rate, whichever is higher April 2017 - Government of Ontario Introduced the 'Fair Housing Plan': 16 measures to address risks in the housing market including a 15% speculation tax on non-residents purchasing homes in the Greater Golden Horseshoe region January 2017 - City of Vancouver ■ Vancouver introduced a tax of 1% of the assessed value of each home which is vacant (principal residence is exempt) October 2016 – Department of Finance ■ Qualifying rate for high-ratio mortgages with a term of five years or more is changed to the 5-year posted rate Portfolio-insured low-ratio mortgage loans must meet the eligibility criteria of high-ratio insured mortgage ■ A principal residence sale must be reported in the seller's tax return, even if any capital gain is protected by the principal residence exemption 52 CANADIAN HOUSING MARKET RBC

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