Recent federal mortgage rule changes are already expanding the reach of Canada’s 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.
“I think it’s been a real significant game-changer,” said Andy Charles, president and CEO of Canada Guaranty.
“For 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… This was the first time that we really saw an opening up.”
The comments came during a panel discussion at Mortgage Professionals Canada’s Toronto Mortgage Symposium featuring Charles, Stuart Levings, president and CEO of Sagen, and Coleen Volk, president and CEO of Canada Mortgage and Housing Corp.
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.
Expanding access for first-time buyers
Charles said the higher price cap has already had a measurable impact on insured activity in the country’s most expensive markets.
“Prior to that, the GTA (Greater Toronto Area) represented about 6% of my total business, and post that it’s now up to 15% to 16%,” he said. “So it’s been a significant increase in terms of what’s available for first-time homebuyers, particularly in the GTA.”
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.
“The market overall contracted, actually,” Levings said. “Contrast 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.”
He said the introduction of 30-year amortizations in particular has given many buyers a meaningful boost in affordability.
“They had just been given a 10% boost in their buying power through that 30-year amort… and they were able to go and actually put in an offer and get a home,” he said. “And they did that in droves…we saw a tremendous year for first time buyers.”
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.
“Those that would have qualified anyway were now able to get bigger properties or more expensive properties,” she said.
Much of the uptake tied to the higher insured price cap has been concentrated in the country’s two most expensive housing markets.
“The $1 million raise cap… was really impactful in Toronto and Vancouver,” Volk said. “About 80-plus per cent of the take-up on that product is in those two areas.”
Market outlook remains uneven
Despite stronger insured activity, panelists said broader economic uncertainty continues to weigh on housing demand, with conditions varying significantly across the country.
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.
“I do feel more optimistic about the second half of the year,” he said. “I don’t think rates are going to do a lot relative to where they are right now. But let’s not forget, house prices are still coming down in many markets around the country… There is definitely an affordability improvement angle.”
Volk said the outlook also varies widely by region, with Ontario facing particular pressure. “The impact is really varied by region and has varied by region and probably will continue to vary by region,” she said. “Ontario has particular challenges. It’s the only province that is expected to see continued house price declines this year.”
The panelists also pointed to the ongoing correction in the condo market, particularly in Toronto, where investor demand has largely retreated.
“The investor market can’t make a reasonable return on their capital… The investor markets have walked away from the condominium market,” Charles said, adding it could take “two to three years” to work through existing supply.
Levings said demand could eventually return once the economics of renting and owning begin to converge.
“At the point where that differential between the rent and the mortgage cost becomes negligible, people are going to start saying, ‘Well, why am I renting? I might as well buy,’” he said.
Canada’s mortgage system remains resilient
Despite current market challenges, the panel ended on a more optimistic note about the resilience of Canada’s housing finance system.
Levings said the country’s mortgage framework remains among the strongest globally.
“I think we should take some confident pride in knowing that the Canadian housing finance system is one of the best in the world,” he said. “We have tremendous lenders with tremendous quality of underwriting… and we have very prudent regulators.”
Charles echoed that view, pointing to the strength of the borrowers qualifying for insured mortgages.
“I’m looking at that 20% of the market that’s insured and I see the credit quality of the borrowers that we’re insuring,” he said. “The people that are qualifying have tremendously high credit scores.”
He added that Canada’s financial resilience remains a key advantage even during periods of housing market uncertainty.
“We have a very, very strong financial housing system in Canada,” he said.
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Last modified: March 3, 2026