A look-ahead: Trends that could impact the industry this year

These are the major storylines brokers will want to keep an eye on in 2017, according to one mortgage lender.

All eyes on Trump
Those sick of seeing the President-elect’s shenanigans pop up in their news feeds won’t be treated to a reprieve anytime soon -- and that includes mortgage brokers.

“It could be just the overall economy; what Trump does with NAFTA – is he going to intimidate companies that have dealt in Canada extensively and may want to set up additional operations in Canada to repatriate and come back to the US? He’s certainly showing that already with Mexico,” Robert Goodall, president and CEO of Atrium Mortgage Investment Corporation said when asked what the biggest industry story will be this year.

“We lenders with diverse portfolios in commercial and residential, the thing we worry about more is a macro event more than a micro event.”

Relief to Alberta
At least that’s the hope. Lenders have been scaling back their offerings in the hard-hit province, making it more difficult for brokers to find mortgage solutions for clients.

“In Alberta, we want to see the price of oil continue to strengthen,” Goodall said. “We haven’t been active there in the last 18 months but we’re hoping to dip our toe in (again) in 2017 but it will depend on whether … oil prices get to a point where the economy starts to recover.”

Interest rates
Many have predicted higher mortgage rates in the coming months and Goodall is no different.

“I think a small increase is likely in the stakes. That means bond yields will probably increase here even though the Bank of Canada has strongly indicated they’re not going to increase short-term rates, they can’t control long-term rates,” he said. “That will depend, in part, on what the US does. They’ve been clear they’re going to be raising rates. That means mortgage rates will move up a bit.

"I’m not expecting they will move up much. I’m expecting a half-point or something like that.”

An end to regulation (at least for now)?
Mortgage regulation was undoubtedly the hottest topic in 2016, with British Columbia’s government bid to crack down on foreign buyers and the federal government placing higher barriers in front of insured mortgage holders.

The worst, however, may be behind us.

“My guess is they’ve finished. I think BC is still trying to figure out the impact that the 15% (foreign sales tax) will have. I think the federal changes have been so late in the year that they’re going to wait and see the effect they will have,” Goodall said. “Most economists think it will have a material impact.”

What stories do you think will define the mortgage industry in 2017? Have your say below.

 

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