This week will touch on some of the highlights from the Mortgage Professionals Conference in Montreal. This is the largest conference in our industry and features all of the significant players in the broker industry. There were a number of highlights to share:
CMHC – CMHC’s CEO Evan Siddall addressed the 1000 plus delegates advising that our governments number one priority is a stable housing market. Mr. Siddall reconfirmed CMHC role is based on needs versus wants and that changes will remain in effect until the housing market balances itself. For now, CMHC is satisfied and current policy is expected to be the status quo.
Technology – A number of players focused on technology and systems to make mortgage broker origination faster and easier. Buzz words such as data scraping, process automation and workflow design were heard along with statement that these are driving our industry to greater efficiency and a better borrower experience. With the pace of mortgage origination slowing, both lenders and brokers are taking the opportunity to reinvent themselves and improve how they work with business partners and customers.
Alternative Lenders – With the implementation of the qualifying Stress Test this year, there has been large increase in private and alternative lending. According to a recent joint study by Teranet and Realosophy, 20% of refinances were funded by alternative lenders in the 2nd quarter of 2018. What is clear is demand for mortgages remains healthy and, with the Federal Government setting high qualification standards for purchases and refinances, many consumers are embracing higher cost alternatives based on need.
Reverse Mortgage Competition – Home Equity Bank who enjoyed a 32 year head start in Reverse Mortgages, now have competition. With slowing home sales and falling home values, some older Canadians are preferring to supplement their retirement via a reverse mortgage rather than selling in a slowing market. Equitable Bank recently announced their new PATH Reverse Mortgage Program. This is significant as consumers can now choose between 2 different plans. Pricing is comparable with Home Equity Bank’s CHIP offering higher mortgage amounts and lending in more areas. Equitable Bank is offering an $800,000 maximum mortgage in most major cities including Greater Vancouver.
On the economic side, bond yields are stable after recent volatility. As expected the markets were pretty quiet in the run up to the US midterms. Thanks again for your amazing support and have an amazing weekend!
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