Today is the first day you'll need to put at least 10 per cent down when buying a house for more than $500,000.
The new mortgage rules are intended to keep housing prices affordable for those wishing to enter some of Canada's hottest real estate markets, such as Toronto and Vancouver.
About half of the homes in Canada's largest city are worth more than $500,000, a threshold that now requires more money put down as established by the federal government last December.
Toronto real estate agent Sonya Cote said first-time home buyers were feeling the pressure to put their 5 per cent down on homes while they still could.
'I think it's a good idea. I'm concerned with the value of properties these days.' - Michael Elmenhoff, Toronto broker
"Coming up with $3,000 or $5,000 or $7,000 more for a down payment to get in there for the first time is a lot of money for first-time buyers," she said.
The rules change meant Cote was able to sell an unrenovated row house with no parking in a week.
"That drove traffic through this place like a circus," she said of the new changes. "We had 103 showings, 13 offers and it went for $149,000 over asking."
The agent predicted real estate traffic will slow now with first-time buyers facing stricter regulations.
Will more buyers eye condos?
Toronto broker Michael Elmenhoff told CBC News he supports the change because of the way home prices have been skyrocketing lately.
"I think it's a good idea. I'm concerned with the value of properties these days," he said, adding buyers may have to rethink their objectives moving forward.
"I think we're going to see more pressure on the lower price condos as a result of that."
Federal Finance Minister Bill Morneau says the government move is aimed at protecting home buyers. (Chris Wattie/Reuters)
People can still put down 5 per cent for homes under $500,000. For example, If you want to buy a $750,000 home, you'll need to have a minimum down payment of $50,000, which is what you get when you add five per cent of $500,000 and 10 per cent of the remaining $250,000.
"We recognize that, specifically in the Toronto and Vancouver markets, we have seen house prices that have been elevated," Finance Minister Bill Morneau said last December.
"We're not talking about bubbles here, we are talking about ensuring that Canadians take the right approach to investing in a home," he noted.
"We want to make sure we create an environment that protects the people buying homes so they have sufficient equity in their home."
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