Representatives from some of Canada’s largest mortgage lenders say the housing market is performing much better than expected this year. Borrowers have largely adjusted to higher interest rates, and lenders expect brokers to capture an increasing share of the market as demand normalizes.
Speaking at the Canadian Mortgage Professionals National Conference in Ottawa, executives from First National Bank, Scotiabank, CMLS Financial, MCAP and BMO said 2025 is a year of resilience, not regression, marked by borrower discipline, balanced regional performance and early signs of renewed confidence.
“There is no renewal cliff,” said Jason Ellis, First National’s president and CEO. “No one here is seeing any signs of a collapse. The housing market has remained stable with arrears of less than 15 basis points.”
Brian Carey, executive vice president and chief operating officer of MCAP, emphasizes staying forward-looking. He noted that MCAP expects residential mortgage activity to exceed $20 billion this year and to exceed $30 billion across all lines of business. “The residential mortgage market in Canada today is $2.7 trillion,” he said. “If we go back 10 years ago, that number was about $1.7 trillion. So if you look back over that period, it’s been pretty good growth.”
Carey added that the situation varied widely across the country, with some areas continuing to show strength while others were still struggling.
“If I look at Alberta, the Prairie and the Maritimes, the market has actually been doing well,” he added. “Prices continue to rise in these markets because they haven’t peaked like they did in Toronto and Vancouver in 2021 and 2022.”
Tracey Gomez, senior vice president of real estate secured lending at Scotiabank, said customers are making rigorous choices as they adjust to a higher interest rate environment.
“In addition to the housing itself, the mortgage market is great,” she said. “We’ve had a lot of renewals from our borrowers this year, so it’s a very healthy conversion and refinance market for anyone in the mortgage business.”
Reflecting on the year’s broader policy changes, Mary Putnam, Canada Guaranty’s senior vice president of sales and marketing, said this year’s federal mortgage rule changes have produced significant changes in improving affordability and providing greater flexibility for buyers.
Key figures for the Canadian Guaranty Corporation portfolio:
- 56% of the new high-ratio products launched this year chose the 30-year amortization method.
- 46% of these borrowers are not eligible to purchase the same home 25 years later.
- Following the new $1.5 million cap, 3.5% coverage now exceeds $1 million.
- 64% of new high-insured business came from broker channels.
Putnam said the changes would help the market be more balanced. “This gives first-time buyers an opportunity to buy a home in a rational process that has been very difficult for many years,” she said, noting that many buyers had previously felt pressured to waive conditions before being approved. “So that makes a big, big difference.”
Lenders see a maturing cycle and stable path forward
Panelists agreed that the market has entered a more stable phase, with borrowers adapting, delinquency rates remaining low and brokers playing a central role in guiding clients through changing conditions.
Here are some of the highlights and insights from the MPC Lenders Panel.
About Arrears and Borrower Resilience
- Jason Ellis, No. 1 nationally: “There’s no renewal cliff…nobody here is seeing any signs of a collapse. The housing market has been holding steady with delinquency rates under 15 basis points.”
- Andrew Gilmour, CMLS Finance: “With the wave of renewals…customers with rates at 1.5 per cent, 2 per cent, 2.5 per cent, rates increased by 250 basis points…Canadian consumers continue to meet their debt obligations.”
About interest rate trends and product mix
- Jason Ellis, No. 1 nationally: “We’re almost certainly going to see another rate cut – maybe in October or December – and then that’s it. We have a normal-shaped curve, it’s not inverted, and the normal curve is our friend now.”
- Ellis: “Our residential borrowers have a terrible habit of choosing the wrong product at the wrong time. In 2021, when five-year fixed rates were around 1.65%, more than 60% of borrowers selected adjustable rates.”
- Amir Tehrani, BMO: “Currently we are seeing about 30% of production going to variable rates. The 3-year is very popular; [but] It’s becoming less and less popular. We are seeing interest rates gradually move towards 5-year fixed rates, but floating rates are still the focus. “
On policy changes and affordability
- Tracy Gomez, Scotiabank: said new federal rules allowing 30-year amortization for insured new construction are having a clear impact on buyer behavior. “It’s really made a huge difference,” she said. “This is an important step in helping improve affordability for consumers. We’ve seen a great year; we’re up 25% year-over-year in insurance. Half of that took 30 years, and more than half didn’t take 30 years. “Lowering payments, in my opinion, is a very disciplined move on the consumer’s part because they know they can take advantage of flexible payment options and then lower the amortization back if they need to. It’s convenient for them. “
- Andrew Gilmour, CMLS Finance: said recent policy changes provide borrowers with greater flexibility to increase credit coverage over time. “Giving consumers the option to graduate on the credit curve without penalizing them gives them choice and flexibility,” he said. “Moving into a quality store and getting lower prices is a really good outcome.”
- Brian Carey, MCAP: “You know, municipal development fees … end up accounting for more than 20 per cent of the purchase price.” Ontario alone has 440 municipalities, each with its own rules, he added, urging lower development fees and greater intergovernmental coordination to avoid conflicting policies.
About broker share and growth
- Andrew Gilmour, CMLS Finance: “If you look at England or Australia, the agent’s share is closer to 75% [versus Canada’s ~33%]… We’re still playing catch-up, but there’s a lot of real organic growth among brokers. “
- Tracy Gomez, Scotiabank: “At Scotia, we like to have multiple channels so customers can get their mortgage where they want it. More and more customers are choosing a broker for proven advice at key moments when buying a home or entering into a mortgage transaction. The brokerage business brings us new clients to Scotia – which is great business for us, whether they are first-time buyers or mid-career clients, as it’s an opportunity to build a long-term relationship.”
- Jason Ellis, No. 1 nationally: “As someone who has spent the better part of the past six months talking to private equity investors about the Canadian mortgage industry, a big part of the message is that we have a real estate market that is growing year over year. We are growing in this growing market. So there is a tailwind, and brokers have a long way to go.”
About technology and artificial intelligence
- Tracy Gomez, Scotiabank: “We’ve moved from pilots and experiments to real use cases. One of the big opportunities for us in the mortgage space to use AI is to generate AI for document and application review…so checking appraisals, checking purchase and sale agreements, checking trade lines and departments and all application inputs so you can streamline accuracy and spend more time exercising good judgment and soundness of transactions.”
- Andrew Gilmour, CMLS Finance: “We take the approach of Iron Man or Marvel characters: There’s still a human underneath, but the suit gives our underwriters superpowers…The AI is getting better at detecting fraud…You’ll start to see these things get automated, or close to automated, approval.”
- Jason Ellis, No. 1 nationally: “If you’re not using AI yet, you’d better develop use cases. We’re in a seasonal business, and if we can use these tools to create capacity and scalability, it will be and has been revolutionary. If you don’t, you’re going to find yourself behind in two and a half years.”
About Lender-Broker Business
- Jason Ellis, No. 1 nationally: “If you want to help us help you, one of the most valuable and free options we offer is to keep your rate with pre-approval and commitment. We typically provide approximately 48 hours’ notice when rates increase, so please submit your application early to help us help you.”
- Amir Tehrani, BMO: “The other thing for us is pre-filing documentation. On our non-broker channel, we have almost 100% pre-filing documentation, so that’s how our system is structured. On the broker side, when documents arrive at the last minute, fraud detection and other processes kick in and every time a new document arrives, my request is to give us five, six, seven days. There are always urgent transactions, but for some brokers we see a higher percentage of last-minute submissions, which just slows down the whole process.”
- Brian Carey, MCAP: “We spend close to $50 million a year on IT, just to give you some context. The better the data, the faster we can get back to you and make the right decision. “
About integration and next steps
- Andrew Gilmour, CMLS Finance: “For those who don’t know, Nesto acquired CMLS in June 2024. I was part of the deal team… and we really felt that the pieces of Tetris were a good fit. We had a fully formed commercial business, they were in the space, they had great technology, we were both interested in the DPO (depository product offering) space, and overall we looked at the residential brokerage market as a way that we could expand very quickly.”
- Jason Ellis, No. 1 nationally: “First National will transition back to a private company. On Wednesday, we will sign an agreement with Birch Hill and Brookfield Private Equity. When we wake up Thursday morning, nothing will be any different — just a different board of directors, which to me will cause more trouble from a reporting perspective. But they will provide us with capital, technology and some good intellectual resources, but other than that, it’s business as usual for First National.”
Photo credit: Amy Godin Photography
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Last modified: October 24, 2025
