According to a Canada Mortgage and Housing Corporation (CMHC) senior analyst, risk is increasing in the mortgage market – but there’s still little reason for undue concern thanks to emerging positive signs in borrowing trends.

Seamus Benwell (pictured top right), who co-authored the body’s recently released Residential Mortgage Industry Dashboard alongside senior specialist, housing research Tania Bourassa-Ochoa, told Canadian Mortgage Professional that while mortgage debt was indeed continuing to rise, arrears were registering a decline at the same time.

“We see mortgage debt growth continuing to increase – it’s gone up about 11% year over year. We’re also seeing that total debt service [TDS] ratios of over 40% are increasing quite a bit in the market – especially since the second half of 2020,” he said.

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“Those two suggest that there is higher risk in the mortgage market. However, the good news story is that we see mortgage arrears for all mortgage lender types going down – so despite mortgage deferrals and other pandemic-related aid programs coming to an end, borrowers are still able to make mortgage payments or take advantage of housing market conditions to sell their property rapidly to avoid default.”