Promoting Consumer Choice in Ottawa

CAAMP-in-OttawaThe Canadian Association of Accredited Mortgage Professionals (CAAMP) was in Ottawa twice these past four weeks. Its missions: to share mortgage market data with policy-makers, support consumer access to more mortgage options and keep issues facing mortgage brokers front and centre.

CAAMP President & CEO Jim Murphy, along with Government Relations Chair Eddy Cocciollo and Chief Economist Will Dunning, met with both the Financial Consumer Agency of Canada (FCAC) and the Conservative Housing Caucus, where CAAMP presented its latest research and housing numbers to 20 MPs. The presentation’s message was to maintain current housing economics by avoiding further mortgage restrictions.

CAAMP’s latest March 25th visit to Ottawa was prompted by the government’s increasing focus on private lending and the housing market’s growing dichotomy. On that last point, it’s increasingly clear in Ottawa that it’s a case of Vancouver/Toronto versus the rest of the country. Markets east of the Ottawa River, for example, saw no price increases last year, while Greater Vancouver and Toronto rose 5.8% and 8.1%, respectively.

The federal government continues to closely monitor the market. Albeit, Prime Minister Steven Harper suggested last week that no further mortgage policy changes are likely at this time.

On February 25th, Murphy and Cocciollo met with the Finance Minister’s top policy representative and his Chief of Staff, the Parliamentary Secretary and the Prime Minister’s Office. These meetings were largely focused on the effect of diving oil prices on Alberta’s housing prospects.

Private lending, or “shadow banking” as some call it, was also on the agenda. Following OSFI’s Guideline-B20 and insurance rule tightening, consumers who used to qualify for traditional lending no longer do. CAAMP explained how these regulatory changes led to an increase in private lending, but that it remains a small slice of the overall market (most estimate less than 3%).

During both Ottawa trips, CAAMP highlighted risks as well as the upside of Canada’s mortgage and housing markets—i.e., record-low mortgage arrears, the slowing of overall mortgage credit growth and trends in borrower prepayments. CAAMP’s most recent survey found that 38% of mortgage holders are reducing their effective amortizations by making additional mortgage payments and/or increasing the frequency of their payments.

Look for more updates in the weeks to come on CAAMP advocacy for consumers and mortgage brokers in the nation’s capital.

Cindy Freiman, Director, Marketing and Communications, CAAMP