By and large, the market has apparently adjusted to the changes introduced by B-20
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Last June, Canadian household mortgage credit saw its largest month-over-month increase in two years, according to Scotiabank.
During that month, the metric grew by 5.2% from May’s volume.
“Mortgage growth has surely rebounded after a period of deceleration from early-2017 to its mid-2018 trough which was induced by a series of measures aimed at tackling runaway home prices,” Scotiabank economist Juan Manuel Herrera and research analyst Alena Bystrova wrote in their report, as quoted by Livabl.
“Real estate markets continue to adjust to regulatory changes and are now benefitting from a decline in borrowing rates after reaching an eight-year high in late-2018, alongside a tightening spell by the Bank of Canada,” they added.
June 2019 also saw the outstanding balance of national mortgage debt grow by 3.7% higher year-over-year, up to $1.57 trillion total.
“The record came with an uptick in the rate of growth, which had bottomed in recent months,” Better Dwelling explained in its analysis of the Bank of Canada figures.
In their report, Herrera and Bystrova stated that acceleration of borrowing activity in non-bank institutions exceeded that of banks. However, non-bank mortgage credit has yet to significantly exceed the long-term average.
“Despite the faster pace of non-bank borrowing growth, it still occupies less than one quarter of market share,” the duo explained.
At present, non-bank lenders account for 21.3% of the mortgage credit market.
