The Crown corporation has been weathering the significant market shifts seen over the past few months
Dramatic shifts in market conditions, most notably higher interest rates, had a significant impact on the Q2 results of Canada Mortgage and Housing Corporation.
The quarter saw the Crown corporation’s unit volumes decrease for transactional homeowner and multi-unit products on an annual basis. This is because the market is in the process of adjusting to rate hikes and mounting unaffordability, CMHC said.
“House prices are also contributing to higher insured loan amounts than prior year and lower insurance provisions,” CMHC added. “Paid claims remain low for all products and the national mortgage arrears rate decreased to 0.25%, from 0.28% at December 31, 2021.”
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Net income for Q2 was $431 million, down from $460 million in the same quarter last year.
“Increased volatility due to inflation and interest rates are impacting interest-sensitive assets and liabilities,” said Michel Tremblay, chief financial officer and senior vice president of corporate services at CMHC. “We continue to monitor market changes and assess any potential impact on our current and projected financial results.”
Q2 was also the first full quarter of CMHC’s new multi-unit mortgage loan insurance offering (MLI Select), with the Crown corporation insuring 7,823 units of MLI Select during the period.
“MLI Select incentivizes the preservation and creation of rental supply and helps address the need for affordable, accessible, and climate compatible housing,” CMHC said.
