As the economic effects of the pandemic continue to play out, many investors are concerned that the number of Canadians defaulting on their mortgages will skyrocket. But, thanks to several key factors, we are unlikely to see a rise in defaults.
One reason is the strength of the private mortgage market, which is funded by investors who expect to generate a return on their investment. Private lenders such as Mortgage Investment Corporations (MICs) are one of the fastest growing segments of the market and had a delinquency rate of only 1.73% in 2019. Defaults were even smaller.
In addition, the private space grew by 25.4% (41.1 billion) in the second quarter of 2019, according to Statistics Canada. This free white paper will show why, if defaults among Canadian homeowners were a major risk, the cracks would have first appeared among these so-called “shadow lenders”. That trend hasn’t materialized and seems unlikely to do so as the economy heads for recovery.
Many Canadian homeowners have also remained gainfully employed during the pandemic, which bodes well for investors.
Download this free whitepaper from CMI and learn more about Canada’s mortgage industry trajectory, and how economic recovery bodes well for the private mortgage market as Canadians continue to prioritize mortgage payments and homeownership amid the crises.
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