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Pasalis gave an example of a buyer who expected a $1 million loan from the bank only to have it cut to $850,000 days before the deal was set to close.

“All of a sudden you have to come up with an extra 150 grand,” Pasalis said. He estimated that up to 5 per cent of deals were at risk now, something unheard of a year ago.

Toronto home prices are down nearly 19 per cent from the April peak and resales were about 40 per cent lower in July than a year earlier, according to the Toronto Real Estate Board data.

Two people with direct knowledge of the matter said that lenders had reduced their average valuation on properties by 12 to 15 per cent since March.

Property appraisers say that while they are the ones to break the bad news to buyers, it is the lenders that hire them who are getting more conservative.

“They have certainly tightened up their criteria,” said Dan Brewer, an appraiser and mortgage broker in Toronto’s Richmond Hill suburb and former president of the Appraisal Institute of Canada.

For example, lenders can require that the comparable sales used to help determine the value of the house be limited to a shorter period or smaller geographic area to ensure the appraisal reflects the cooling market, Brewer said.

As a mortgage broker he sees the impact of more risk-averse lenders, he said, with many more calls from buyers who need a second mortgage because the first one no longer covers their bid.

“I would say about 20 per cent of our files are now asking for secondary financing. That is a marked increase,” said Brewer.