Canada is the fastest-growing G7 country in the world, with a GDP of 2.2 trillion and a population close to 40 million. Canada accepts approximately 300,000 immigrants yearly. Toronto and Vancouver experience high degrees of immigration and are considered ‘Alpha’ and ‘Beta +’ world cities respectively and thus attract wealthy individuals with multiple homes, akin to London, New York, and other major cities, albeit on a smaller scale.
Canada’s economy is underpinned by its legal and financial system, which gives it growth, flexibility and reliability.
Canada is the fastest-growing G7 country in the world, with a GDP of 2.2 trillion and a population close to 40 million. Canada accepts approximately 300,000 immigrants yearly. Toronto and Vancouver experience high degrees of immigration and are considered ‘Alpha’ and ‘Beta +’ world cities respectively and thus attract wealthy individuals with multiple homes, akin to London, New York, and other major cities, albeit on a smaller scale. Canada’s economy is underpinned by its legal and financial system, which gives it growth, flexibility and reliability.
This 1.6 trillion residential mortgage market in Canada has both insured and uninsured mortgages. Insured mortgages comprise approximately 55% (or $900 billion) of the residential debt, and uninsured debt is around 45% (or $700 billion). This uninsured market is $500 billion underwritten by banks, and the balance financed by special-purpose mortgage finance companies, including mortgage investment companies. STMIC invests in the uninsured market as part of this 200 Billion dollar sector.
Approximately 620,000 homes are purchased each year, with about 77 percent having a mortgage. As well in 2018, 83 billion in equity was extracted by existing homeowners by mortgage financing. The average family with a mortgage in Canada carries a mortgage debt of 211,000 dollars. In the year ended June 30th, 2019, about 868,000 mortgages were originated, not including home equity lines of credit. These new mortgages had an average size of 267,000 dollars. It is estimated that of these mortgages, approximately 295,000 were placed by mortgage brokers, using a multiplicity of funding sources, including Private lenders and Mortgage Investment Corporations.
Overall mortgage default rates in Canada are low; in July 2019, arrears were about 0.23%, according to the Canadian Bankers Association. To be clear, this is less than one-quarter of one percent. Mortgage arrears historically have been averaged about 0.7 percent of outstanding mortgages since 1991, but recently have primarily stayed within a narrow range of between 0.24 and 0.37 percent. At the close of 2018, these arrears were at 0.24% for Banks and Mortgage Finance companies. For private lenders, they were under 2%. These are not losses just arrears: losses are substantially less. The largest private mortgage lenders typically set aside between 0.5—1.9% for mortgage losses on their portfolios and expect to have between 2 and 7 percent of their assets ‘impaired’, although ultimately collectible. Actual losses on mortgages were a fraction of these numbers, less than 0.03% of outstanding loans for insured loans, and approximately 0.12% for uninsured loans, an amount reflected in the returns charged for interest on all loans.
As the largest financial market sector in Canada, Canadian mortgages total over 1.5 trillion of loans outstanding, with consistent and reliable returns.Unlike other North American jurisdictions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.ctions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.ctions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.
As the largest financial market sector in Canada, Canadian mortgages total over 1.5 trillion of loans outstanding, with consistent and reliable returns.Unlike other North American jurisdictions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.ctions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.ctions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.
As the largest financial market sector in Canada, Canadian mortgages total over 1.5 trillion of loans outstanding, with consistent and reliable returns.Unlike other North American jurisdictions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.ctions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.ctions almost homeowner loans are guaranteed by the owner so default rates have always remained low.
This ensures the Banking sector only offer credit to mortgage clients with regular income and relatively high credit scores. These restrictions on loan origination and underwriting impact all federally regulated financial institution as well as mortgage insurers. This has led to a large sector of the mortgage client population unable to access these highly regulated mortgage institutions. These clients have turned to private mortgage lenders, of which we are one. This market segment is over 200 Billion dollars.