Mortgage delinquencies remain low, originations down 10%

The average Canadian mortgage balance was 5% higher in the year to mid-2017 at $198,781.

Data from TransUnion shows that despite rising debt, serious delinquencies were down 4 basis points to 0.65%, the third consecutive quarter of decline amid a period of stability.

“Despite increases in mortgage debt, serious delinquency rates remain low with very little volatility observed over the past two years,” said Matt Fabian, director of research and industry analysis for TransUnion Canada. “Consumers have so far been able to manage their mortgage obligations despite the increasing balance levels. We will continue to monitor these trends especially as interest rates rise, though we don’t anticipate a material impact on mortgages in the near term.”

New account balances were up 8% to $280,093 in the first quarter (reporting is delayed by a quarter due to reporting lag) while originations were down 10.4% compared to Q1 2016.

“Recent new regulations in Ontario appear to have had an impact on the volume of home sales and, consequently, mortgage demand,” added Fabian. “So while the number of mortgages is increasing, it is doing so at a slower rate than last year.”

There were 6 million active mortgage accounts in the second quarter of 2017, up 1.2% from a year earlier.

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