The moderation of Canada’s housing market means reduced revenue for the Canada Mortgage and Housing Corporation.
Its quarterly financial report for the first three months of 2019 reflects the reduced size of the insured mortgage market as home sales continue to lag the highs of recent year following several policy changes introduced in 2018.
In the period ended March 31, 2019, CMHC generated revenues of $1.48 billion and net income of $394 million.
Mortgage insurance in force held fairly steady at $442 billion, compared to $448 billion at the end of the previous quarter.
The quality of the loans backed by CMHC remained strong with the typical CMHC-insured borrower having a credit score of 755, equity of 7.6%, and a purchase price of $284,164. The overall arrears rate was 0.30%.
The corporation provided mortgage insurance for more than 39,000 homes across the country, supporting over 17,000 homebuyers and 22,000 rental units; and provided $39 billion in guarantees through its mortgage funding activities.
CMHC declared $505 million of dividends in the quarter, paid to the Canadian government, its only shareholder. This was more than offset by $575 million of comprehensive income, resulting in a slight increase in total equity of Canada.
National Housing Strategy
CMHC’s role in the National Housing Strategy saw investment of $777 million on behalf of the Government of Canada to create and support much-needed housing units for low- and middle-income Canadians.
And bilateral agreements were signed with Prince Edward Island, Alberta and Yukon under the new Housing Partnership Framework to support the delivery of key NHS initiatives.
“In the first three months of 2019, we supported Canadians across the country access housing they can afford and that meets their needs, while responsibly managing our resources and contributing to the stability of the financial system,” said Lisa Williams, Chief Financial Officer