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Photo: Teresa Alexander-Arab/Flickr

When it comes to Canada’s housing market, the federal government plans to stand on the sidelines for the time being.

“We will continue to be vigilant in monitoring the market,” said Canadian Finance Minister Bill Morneau after delivering a speech in Toronto today, Global News reports.

“We have no further action under consideration in terms of housing,” he added.

Policymakers are observing the market to see what impact recent tax and mortgage measures have, Morneau explained.

At least one economist has speculated the measures will put downward pressure on sales activity in the closing months of this year.

“We will remain on top of this because we know this is a very important risk to our economy,” Morneau continued, referring to the possible fallout from government intervention.

In early October, Morneau announced a number of measures geared towards reducing risks facing the Canadian housing market.

These included closing a tax loophole that allowed non-residents to skirt paying capital gains taxes on home sales by declaring the property as their primary residence.

Another measure, which has resulted in broader stress testing for mortgage applicants, took effect earlier this month on October 17th.

A third measure is set to take effect on November 30th. On that day, eligibility requirements for low- and high-ratio insured mortgages will be streamlined. Both will have a maximum amortization period of 25 years and minimum qualifying credit scores of 600.

Though further cooling measures aren’t on the docket, Morneau outlined his course of action for the future in his speech today.

“I will continue to act to ensure that household debt levels are sustainable, that lenders are acting prudently, and that increases in interest rates or a housing market downturn don’t put at risk the economic growth we are working so hard to accelerate.”

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