CMHC Housing Observer Highlights
The CMHC Housing Observer 2013 provides some interesting insights on the sound state of the Canada’s housing market. The following are some of the highlights.
- Mortgage Arrears are Low. Contrary to some public perception, CMHC reports that due to Canada’s sound lending practices, only .31% of residential mortgages were 3 or more months in arrears as of June 2013. To pay off mortgages sooner, in 2012, 31% of recent buyers either made a lump sum payment and/or increased their monthly payment. 44% had their monthly payment set higher than the minimum.
- Home Equity Levels are Strong. While the Canadian Association of Accredited Mortgage Professionals (CAAMP) sighted equity levels of 47% for Canadians with mortgages in 2013, CMHC’s insured mortgages indicated an average equity of 45% for 2012.
- Competition Continues to Support Mortgage Discounting. The Observer refers to CAAMP’s survey for 2013 suggesting an average savings of 2.2% on 5-year fixed mortgages due to discounting. Posted rates for 5-year fixed mortgage averaged at 5.25%, yet the average discount rate was 3.05%.
- Single Detached Houses Dominate. Across Canada55% of households, including “every age segment” below 85 live in single detached homes, “down from 57% in 2001 and 62% in 1966.” While this number is below 50% in urban centres such as Toronto, Montreal and Vancouver, single detached homes accounted for almost three quarters of housing for the rest of Canada.
- One-person households are the fastest-growing type at 28% of households in 2011. Couples with children accounted for 29% in 2011 compared to 50% in 1971