Scotiabank Strategic Priorities and Track Record
Canadian Mortgage Market
Canadian housing market is less expensive on a global scale, particularly for buyers with
U.S dollars
Two-thirds of Canadian households do not have a mortgage
-
One-third of households rent
One-third own their homes, but have no mortgage
Two-Thirds of CDN Households
do not have a Mortgage
40
40
%
35
30
25
20
20
Mortgage holders
15
No negative equity mortgages in Canada
10
89% of borrowers have 75% or less LTV. Significant price decreases required to
reach a negative equity position
5
0
-
Amount of non-recourse mortgages are low (~6-7% of total Canadian mortgages at
most) and isolated to only Alberta (excluding high-LTV mortgages) and
Saskatchewan.
Owned dwelling Owned dwelling
with a mortgage without a
Rented
mortgage
Sources: Scotiabank Economics, Statistics
Canada.
High Percentage of Equity
High amount of equity: average equity ratio is 74%
On average, 40% of available HELOC credit is drawn, 60% is undrawn
Approximately half of first-time home buyers in Canada are able to source their
down payments from their personal savings
2014-16 data shows 75% of buyers from that period have 25% or more equity
Partly reflects speed of rising house prices, but also increased emphasis on down
payment requirements and tightened mortgage rules
2014-16 data indicates 39% of first-time home buyers had less than 20% down-a low
point historically
Reflects movement away from non-conforming low down-payment loans
Efforts to cool the housing market are working, as British Columbia is showing signs of
stabilization after foreign buyers' tax was enforced. Absent better data, foreign ownership
in the GTA is estimated to be <3%.
80
real estate equity as % of
real estate assets
Canada
75
70
65
60
55
50
445
40
35
US
90 92 94 96 98 00 02 04 06 08 10 12 14 16
Sources: Scotiabank Economics, Statistics Canada, U.S. Federal Reserve.
Data through 2016Q4.
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