As Canada's only provider of mortgage loan insurance for multi-unit residential properties, CMHC is seeing continued strong growth in our multi-unit insurance products, in both insured units and dollars. Insured volumes totaled $31,175 million in the first half of 2024, up from $19,406 million during the same period last year, a 61% increase. Our insurance facilitates access to preferred interest rates, lowering borrowing costs for the construction, purchase and refinance of multi-unit residential properties, and also facilitates renewals throughout the life of the mortgage.
With continued growing demand for rental housing in Canada, CMHC anticipates a continued increase in demand for our multi-unit mortgage loan insurance. In addition to this, the Office of the Superintendent of Financial Institutions (OSFI), as a part of its annual risk outlook released on May 22, 2024, announced new capital requirements for multi-unit residential exposures that will be published in Q4 2024. The release of this new framework results in uncertainty as to the amount of capital we will be required to hold.
As a result of these two factors, we have decided to temporarily suspend our dividend to our shareholder, the Government of Canada, on a prospective basis. This temporary suspension represents $145 million for Q2, 2024. While our current capital position remains strong, the preservation of capital allows our multi-unit business to grow and respond to the increased need in the market for the supply of purpose-built rental housing.
Quote:
"It is encouraging to see continued increase in demand for our multi-unit insurance products which leads to increased rental housing supply. We remain committed to our important role of furthering and supporting the growth and sustainability of purpose-built rental supply in Canada."
– Michel Tremblay, Chief Financial Officer and Senior Vice-President, Corporate Services
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