Canadians say they are comfortable with their mortgage debt but fewer homes are being built: CAAMP
The Canadian Association of Accredited Mortgage Professionals (CAAMP) releases annual fall survey report on residential mortgage market
TORONTO (November 19, 2013) – Canadian mortgage holders have told the Canadian Association of Accredited Mortgage Professionals (CAAMP) in its fall 2013 survey that they are comfortable with their mortgage debt levels and consider mortgages to be a form of “good debt.” The Annual State of the Residential Mortgage Market in Canada report, released today, was authored by CAAMP Chief Economist Will Dunning.
This level of comfort may be due to the fact that Canadians believe they are in control of their mortgages: taking aggressive actions to pay them down, leveraging their equity to consolidate debt or make new investments, taking advantage of low interest rates and increasingly turning to mortgage brokers rather than major banks for their mortgage needs.
• Mortgage brokers are gaining share in the overall mortgage market compared to traditional financial institutions: among all new mortgages obtained this year, 40 per cent were obtained through a mortgage broker and 42 per cent from a bank; overall the broker share in the industry has increased from 25 per cent to 28 per cent since last year
• Confidence in the market is strong: less than 10 per cent of Canadians expect that a housing bubble will burst, though the expectation is stronger among younger people
• 80 per cent of homeowners selected at least one of the following emotions when asked about their mortgages: comfortable, confident, content, secure
• More than 80 per cent of Canadian homeowners have at least 25 per cent equity in their homes
• Of the new homes purchased in the past year, 57 per cent were purchased by first time buyers
• 68 per cent of Canadians feel mortgage debt is “good debt”
• For mortgages repaid in the past two decades, actual repayment periods have been 30 per cent shorter than original contracted periods
• This year, 38 per cent of mortgage-holders took steps to accelerate their repayments and shorten their amortizations
• CAAMP projects housing starts in 2014 could be well below CMHC predictions, as much as 17 per cent lower than the average between 2010 and 2012