Residential mortgage activity in Canada increased on both a yearly and a quarterly basis in the second quarter. Several housing market indicators remained at record high levels relative to previous years despite showing signs of deceleration compared with the first quarter of 2021.
Non-banks report increase in the value of residential mortgages extended in the second quarter
The value of the mortgages extended by Canadian non-bank mortgage lenders in the second quarter reached $72.1 billion, 50.5% higher than the value recorded in the second quarter of 2020. At $346.6 billion, the value of mortgages outstanding held by non-bank mortgage lenders at the end of the second quarter of 2021 exceeded the value held at the end of the same quarter last year by 4.7%.
Mortgages extended and held by non-bank lenders also registered increases relative to the first quarter, even though the Canadian Real Estate Association reported that home sales decreased in all three months of the second quarter of 2021. This may be because of the lag between the sale of a home and the transfer of the corresponding mortgage funds. From the first quarter to the second quarter of 2021, the number of mortgages extended rose by 90,266 (+47.1%), while the number of mortgages outstanding increased by 6,720 (+0.4%). Quarterly increases were also registered in the value of mortgages extended (+39.0%) and mortgages outstanding (+2.3%). Quarterly fluctuations in mortgages extended are in part attributable to seasonal variations in mortgage activity.
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