According to the Canada Mortgage and Housing Corporation, the growth of residential mortgage debt in the first half of 2021 is reaching levels that have not been seen in a decade. Whether in Vaudreuil-Dorion, Salaberry-de-Valleyfield, Ormstown or even Beauharnois, no sector is exempt.
The report provides a comprehensive view of the residential mortgage market in Canada from mortgage granting to payment. “We also see for mortgages that the number in arrears has reached its lowest level in 30 years. Many borrowers have benefited from a mortgage payment deferral program offered by CMHC and the institutions”, said Tania Bourassa-Ochoa, Senior Specialist, Housing Research, CMHC.
Mortgage credit trends
The burden of mortgage debt service in Canada as a share of disposable income continued to increase in the first quarter of 2021. This trend is driven by growth in projected principal repayments, in part due to higher mortgages. resulting from the rapid rise in house prices in 2020.
Mortgage rate trends
The large gap between fixed and variable rates has led more borrowers to opt for variable rate mortgages. Over 40% of new mortgages issued in the second quarter of 2021 are variable rate.
New mortgage borrowers continued to opt for long-term mortgages to take advantage of historically low interest rates.
Trends in Mortgage Loan Insurance Industry
The big six banks provided a greater share of newly issued mortgages in 2020 (68%) than in 2019 (67%). One-fifth of new mortgages in 2020 were provided by non-bank lenders.
Trends relating to types of mortgage lenders
In 2019, the country’s six major banks continued to have a strong presence in the housing finance market, with a 67% share of newly granted mortgages.
Mortgage companies (CMCs) account for 20% of the insured mortgage market and credit unions 12%. CMHC contributes to the stability of the housing market and the financial system by supporting Canadians in need and providing research and advice to all levels of government, consumers and the housing sector across the country.