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<\/a><\/p>\nPhoto:\u00a0Brian Babb<\/a>\/Unsplash<\/a><\/em><\/p>\n Canadian mortgage borrowers have been waiting years for this moment.<\/p>\n This week the Bank of Canada\u2019s qualifying rate declined, something that hasn\u2019t happened since 2016.<\/p>\n The rate fell to 5.19 percent from 5.34 percent the previous week.<\/p>\n\n That\u2019s significant because the rate, an average of the five-year posted fixed rates available from Canada\u2019s six biggest banks, sets the bar for mortgage stress tests.<\/p>\n Since 2016, borrowers who can\u2019t muster a downpayment of at least 20 percent have had to qualify at this Big Six average.<\/p>\n Beginning last year, similar stress testing was introduced to the uninsured segment, so homebuyers could no longer sidestep the test by simply putting forward a larger downpayment.<\/p>\n The newer stress test has an additional element: insured borrowers either have to qualify at the so-called benchmark rate or their contract rate plus two percentage points, whichever is higher.<\/p>\n Last month, five-year fixed-rate mortgages sunk to a two-year low when the lowest available rate was 2.64 percent, according to RateHub, a mortgage-comparison website.<\/p>\n In that case, a borrower would have to qualify at the Bank of Canada\u2019s benchmark rate, as it surpasses 2.64 percent plus 2 percentage points.<\/p>\n There have been calls from the industry to ease the stress test. Some argue the test is too tough and puts homeownership out of reach for too many.<\/p>\n The British Columbia Real Estate Association estimates that home sales in the province were reduced by as much as 15 percent in 2018 because of the stress test introduced that year.<\/p>\n While the qualifying rate dropping likely isn\u2019t exactly what critics had in mind \u2014 one expert recommends reducing the test<\/a> in the case of larger downpayments, for instance \u2014 it could help some Canadians realize their homebuying dreams.<\/p>\n However, another mortgage rate comparison site, RateSpy, suggests the decline isn\u2019t sizable enough to make a big difference in the grander scheme of things.<\/p>\n