The cooling housing market is a direct result of tight mortgage restrictions. As such, Canadian home builders are pleading with the federal government to loosen its grip.

Mattamy Homes Ltd. is North America’s largest closely held home builders and executives at the real estate behemoth believe the rules have accomplished the sought-for soft landing. The executives also point out that rising interest rates can take care of the rest.

The Canadian Home Builder’s Association is concerned that these rules will steamroll millennials and softer markets such as Calgary.

As of January 2018, mortgage-holders must be able to make payments at 2% over the contracted rate—even if they don’t require mortgage insurance and have made a 20% down payment. Having already been put in place for insured mortgages, the B-20 stress tests can be attributed to the 12% drop in housing prices compared to 12 months before although the sales prices have since stabilized.

In an interview at Bloomberg’s Toronto office, the CEO of Mattamy Canada, Brad Carr says that the company will continue to press the government to cool off on B-20 tests. He states that the target has been reached and continuing in this manner is ‘overkill’. Rising rates do their natural job and the government should remove or cap the stress tests with the 2% spread.

Founder of Mattamy, Peter Gilgan says that a 1.5% or 1% reduction is suitable.

David Foster, director of communications at the CHBA also believes the new stress tests ought to be repealed or done away with altogether because of the damage they are doing to softer markets such as Calgary. Mortgage restrictions are particularly rough on younger first-time buyers and will continue to disenfranchise the specific demographic. They’re also pushing people towards overly-risky variable rate mortgages and towards the non-regulated mortgage space.

Will the pleas of these housing companies be heard, or will they fall on deaf ears?