What's most concerning to me isn't the 45 basis point increase, as of June 1st, but more the 85 basis point increase since last year. Essentially, since last year the CMHC fees for homebuyers with less than a 10% downpayment increase by nearly 31%. If similar rises continue, it could drastically change the landscape of mortgage financing and real estate.
The average price for a freehold detached house in Milton was $579,500 in 2015. If someone were to put just shy of 10% down ($57,900), as of June 1st, the CMHC fees will total nearly $19,000, over a 25 year amortization. However, the $115,900 required to reach the 20% minimum, is not readily available in liquid assets for many homebuyers. It can be very intimidating for the homebuyer.
When it's broken down over the entire length of the loan, it amounts to $29 per bi-weekly payment, which seems more manageable. However, it ultimately means people without the full 20% down, may be looking at $20,000 decrease in their dream home budget.