🚧Could this mark the END of the minimum 5% down payment for homebuyers⁉️
📣BREAKING NEWS: In a recent Parliamentarian debrief of the House of Commons standing Finance Committee, Evan Siddall, President and CEO of Canada Mortgage and Housing Corporation (CMHC) Société canadienne d'hypothèques et de logement(SCHL) spoke about the role CMHC has played in supporting Canadians through the COVID-19 pandemic noting:
📍Currently, 12% of all Canadian mortgages are under deferral and that number could go as high as 20% by September
📍This growing debt "deferral cliff" that looms in the fall could result in a significant increase in mortgage arrears if the economy has not recovered significantly
📍CMHC is now forecasting a decline in average house prices of 9-18% in the coming 12 months
📍Given this level of risk, unless we act quickly, home buyers purchasing with 5% down are at the greatest risk of loss given the cost of homeownership at that level
Under the current economic circumstances and given the risk this represents to CMHC and the balance of the default insurers, this move makes sense.
Additional details about this debrief can be found in the CMHC press release noted in the link below: