Mortgage News, Home sales down in 2017 as delinquency rates improve

Canadians bought fewer new mortgages in 2017 as home sales dropped, but delinquency rates improved as those who buy are better able to pay their monthly payments even as costs rise [19659002]. $ 264.2 billion in 2017, down 6.5% from 1,025,400 new mortgages totaling $ 268.7 billion in 2016, according to new data from the Canada Mortgage and Mortgage Corporation. Housing

The number of new mortgages was particularly weak in the fourth quarter of 2017, it decreased by 7.7% compared to the same period the previous year, while the total value of all new mortgages decreased by 4.9%, said CMHC. The original trends are based on data from new mortgage accounts, which include mortgages for newly purchased homes as well as mortgages renewed at another financial institution.

Brent Weimer, Senior Specialist in Socio-Economic Analysis at CMHC, said the volume of new mortgages dropped last year that home sales have also fell, leading to lower demand for new loans. The number of homes sold in Canada decreased by 4% in 2017, due to an 18% drop in sales in the Greater Toronto Area and 10.5% in Vancouver, according to data from the US. Canadian Real Estate Association. [19659002] While the volume of new mortgages declined in 2017, the average size of a new mortgage rose while house prices climbed 4.1% nationally. Mr Weimer said that home price inflation has even been observed in markets – like Toronto – where total sales volume was down.

"There are several markets where the average price of a new home has increased dramatically in 2017 CMHC stated that the average outstanding mortgage loan amounted to $ 203,350 in the fourth quarter of last year, up 4% from $ 195,770 The average balance of a new mortgage was $ 280,070 in the fourth quarter of last year, up from 3% compared to $ 271,890 compared to the fourth quarter of 2016.

In the fourth quarter of 2017, homebuyers who took out a new mortgage paid an average of $ 1,418 per month, an increase of almost 7% compared to the previous year.

Despite the growth in the size of mortgages, Canadians seem to be able to pay their loans. Only 0.29% of mortgages were outstanding in the fourth quarter of 2017, an improvement of 0.34% on the same date in 2016, according to data prepared for CMHC by the credit rating agency Equifax Canada. Mortgages are considered past due when payments are over 90 days in arrears.

Mr. Weimer stated that mortgage defaults are closely related to employment trends and that national unemployment rates have been among the lowest in Canada since the 1970s.