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Canada’s Finance Minister Bill Morneau faces a delicate decision on housing as his own officials push for tighter mortgage rules to cool Toronto and Vancouver real estate.

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Mortgage holders with government-backed loans could be required to put down as much as 10% of the value of the house, a move that would hit first homebuyers hard.

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The finance department recommended raising the minimum down payment on insured mortgages to as high as 10 per cent from 5 per cent for homes above a certain value, according to people familiar with the plans, speaking on condition they not be identified because the deliberations aren’t public. While former Finance Minister Joe Oliver rejected the recommendation earlier this year, department officials raised the proposal again at an October meeting with industry representatives, according to one of the people.

Morneau, who replaced Oliver after October elections, said days into his new job that along with the budget, real estate was one of the first briefings he sought. That suggests policy makers are grappling with what, if anything, should be done to contain Canada’s two most expensive markets without precipitating a major decline in cities like Calgary and Montreal, where prices are flat or falling.