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Recent federal mortgage rule changes are already expanding the reach of Canada\u2019s insured mortgage market, with mortgage insurers pointing to a surge in first-time buyer activity and renewed demand in high-cost regions like the Greater Toronto Area.<\/p>\n
\u201cI think it\u2019s been a real significant game-changer,\u201d said Andy Charles, president and CEO of Canada Guaranty.<\/p>\n
\u201cFor those of you that have been in the industry for a few years, coming out of the Global Financial Crisis, there was a significant amount of belt-tightening happening from a policy point of view in Ottawa\u2026 This was the first time that we really saw an opening up.\u201d<\/p>\n
The comments came during a panel discussion at Mortgage Professionals Canada\u2019s Toronto Mortgage Symposium featuring Charles, Stuart Levings, president and CEO of Sagen, and Coleen Volk, president and CEO of Canada Mortgage and Housing Corp.<\/p>\n
The discussion focused on a series of federal policy changes introduced in 2024, including the introduction of 30-year amortizations on insured mortgages for first-time homebuyers purchasing newly built homes and an increase in the insured mortgage price cap from $1 million to $1.5 million.<\/p>\n
Charles said the higher price cap has already had a measurable impact on insured activity in the country\u2019s most expensive markets.<\/p>\n
\u201cPrior to that, the GTA (Greater Toronto Area) represented about 6% of my total business, and post that it\u2019s now up to 15% to 16%,\u201d he said. \u201cSo it\u2019s been a significant increase in terms of what\u2019s available for first-time homebuyers, particularly in the GTA.\u201d<\/p>\n
Levings said the rule changes arrived at a time when the broader housing market was slowing, helping unlock pent-up demand from buyers who had struggled to compete during tighter market conditions.<\/p>\n
\u201cThe market overall contracted, actually,\u201d Levings said. \u201cContrast that with what Andy just said in terms of how much the first-time insured market expanded. It really speaks to that pent-up demand that we all knew was out there.\u201d<\/p>\n
He said the introduction of 30-year amortizations in particular has given many buyers a meaningful boost in affordability.<\/p>\n
\u201cThey had just been given a 10% boost in their buying power through that 30-year amort\u2026 and they were able to go and actually put in an offer and get a home,\u201d he said. \u201cAnd they did that in droves\u2026we saw a tremendous year for first time buyers.\u201d<\/p>\n
Volk said the longer amortization has expanded borrowing capacity for many first-time buyers by lowering monthly payments. CMHC estimates that roughly 20% of borrowers who opted for a 30-year amortization would not have qualified for the same mortgage without it, while others were able to stretch their purchasing power.<\/p>\n
\u201cThose that would have qualified anyway were now able to get bigger properties or more expensive properties,\u201d she said.<\/p>\n
Much of the uptake tied to the higher insured price cap has been concentrated in the country\u2019s two most expensive housing markets.<\/p>\n
\u201cThe $1 million raise cap\u2026 was really impactful in Toronto and Vancouver,\u201d Volk said. \u201cAbout 80-plus per cent of the take-up on that product is in those two areas.\u201d<\/p>\n
Despite stronger insured activity, panelists said broader economic uncertainty continues to weigh on housing demand, with conditions varying significantly across the country.<\/p>\n
Levings noted that while Canada avoided a deeper economic downturn than many had feared last year, uncertainty tied to trade tensions and the broader economy has continued to dampen consumer confidence.<\/p>\n
\u201cI do feel more optimistic about the second half of the year,\u201d he said. \u201cI don\u2019t think rates are going to do a lot relative to where they are right now. But let\u2019s not forget, house prices are still coming down in many markets around the country\u2026 There is definitely an affordability improvement angle.\u201d<\/p>\n
Volk said the outlook also varies widely by region, with Ontario facing particular pressure. \u201cThe impact is really varied by region and has varied by region and probably will continue to vary by region,\u201d she said. \u201cOntario has particular challenges. It\u2019s the only province that is expected to see continued house price declines this year.\u201d<\/p>\n
The panelists also pointed to the ongoing correction in the condo market, particularly in Toronto, where investor demand has largely retreated.<\/p>\n
\u201cThe investor market can\u2019t make a reasonable return on their capital\u2026 The investor markets have walked away from the condominium market,\u201d Charles said, adding it could take \u201ctwo to three years\u201d to work through existing supply.<\/p>\n
Levings said demand could eventually return once the economics of renting and owning begin to converge.<\/p>\n
\u201cAt the point where that differential between the rent and the mortgage cost becomes negligible, people are going to start saying, \u2018Well, why am I renting? I might as well buy,\u2019\u201d he said.<\/p>\n
Despite current market challenges, the panel ended on a more optimistic note about the resilience of Canada\u2019s housing finance system.<\/p>\n
Levings said the country\u2019s mortgage framework remains among the strongest globally.<\/p>\n
\u201cI think we should take some confident pride in knowing that the Canadian housing finance system is one of the best in the world,\u201d he said. \u201cWe have tremendous lenders with tremendous quality of underwriting\u2026 and we have very prudent regulators.\u201d<\/p>\n
Charles echoed that view, pointing to the strength of the borrowers qualifying for insured mortgages.<\/p>\n
\u201cI\u2019m looking at that 20% of the market that\u2019s insured and I see the credit quality of the borrowers that we\u2019re insuring,\u201d he said. \u201cThe people that are qualifying have tremendously high credit scores.\u201d<\/p>\n
He added that Canada\u2019s financial resilience remains a key advantage even during periods of housing market uncertainty.<\/p>\n
\u201cWe have a very, very strong financial housing system in Canada,\u201d he said.<\/p>\n
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Last modified: March 3, 2026<\/p>\n<\/p><\/div>\n