Earnings & Dividend Growth Presentation
CANADIAN MORTGAGE MARKET
Less than half of households have a mortgage or a HELOC
Mortgage holders
。 Less than 50% of Canadian households have exposure to a mortgage
and/or a HELOC
。 Negligible number of negative equity mortgages in Canada
。 91% of all homeowners have equity ratios of 25% or higher. Significant price
decreases required to reach a negative equity position
○
High share of equity: average equity ratio is 74% (excluding HELOCs)
。 Approximately half of first-time home buyers in Canada are able to source
their down payments from their personal savings
• 2014-17 data show 79% of buyers from that period have
25% or more equity
○ Partly reflects speed of rising house prices, but also stepped-up down
payment requirements and tightened mortgage rules
2014-17 data indicate only 42% of first-time home buyers
had less than 20% down
More than 50% of Households Do Not
Have a Mortgage or HELOC
45
40
40
% of households, 2017
10.6
with HELOC
35
30
25
45
3.4
20
32.0
15
30.7
22.8
10
5
0
Owned dwelling Owned dwelling
w/ mortgage w/o mortgage
Sources: Scotiabank Economics,
Mortgage Professionals Canada.
Rented
High Percentage of Equity
(real estate equity as % of real estate assets)
80
%
75
70
865
65
60
60
Official (excludes HELOCS)
Cda estimate
including HELOCS
US estimate
with NFPs
excluding
HELOCS
Efforts to cool the housing market are working, which
implies moderating price appreciation
55
50
00
45
45
40
40
Official FRB with NFPs
(includes HELOCs)
35
90 92 94 96 98 00 02 04 06 08 10 12 14 16
Sources: Scotiabank Economics, OSFI, FCAC,
Statistics Canada, Federal Reserve Board.
Scotiabank 52View entire presentation