CMHC releases results for third quarter of 2023

OTTAWA, ON, Nov. 29, 2023 /CNW/ - Canada Mortgage and Housing Corporation (CMHC) saw continued increases in demand for multi-unit insurance products this quarter, driven by an increase in new construction units insured, especially in our MLI Select product which focuses on affordability, accessibility, and climate compatibility. Further details are outlined in our Quarterly Financial Report released today.

For the three months ended September 30, 2023, we insured 51,443 multi-unit residential units of which 20,273 are new construction. In the same quarter of 2022, we insured 43,457 units, a growth of 18%. The increase in multi-unit residential is partially offset by a decrease in transactional homeowner unit volumes. Rising interest rates and a slowing economy were key contributors to subdued sales activity and price growth for transactional homeowner insurance. Canada's average MLS^® price was $679,553 during the first three quarters of 2023, a drop of 5.3% from the same period a year earlier, marking the largest decline in home prices in recent history. MLS^® sales activity dropped 14.9% to 447,280 units over the same period. This is the highest drop in sales observed since the mid-1990s.

We continue to deliver the National Housing Strategy on behalf of the Government of Canada. The application portal for the Housing Accelerator Fund (HAF) opened during Q3, and has since closed. The first agreement was announced in September, and to date we have announced nine agreements with municipalities as well as an agreement with the Province of Quebec. Budget 2022 also included $1.5 billion for a third round of the Rapid Housing Initiative, which addresses the urgent housing needs of people who are made vulnerable and prioritized under the National Housing Strategy. As of Q3, these funds are fully committed.

Quote:

"Our commercial products are helping to create housing supply for people in Canada. For instance, we have provided insurance for 80,213 housing units in this quarter alone. We are also delivering numerous housing programs on behalf of the Government of Canada. CMHC is doing all we can to get housing program funding to proponents as fast as possible and will continue to make further improvements to our processes."

-- Michel Tremblay, Chief Financial Officer and Senior Vice-President, Corporate Services

Additional highlights for the three-month period ending September 30, 2023:   

• Net income for Q3 was $358 million, down from $391 million in Q3 2022. This is mainly due to an increase in net losses on financial instruments of $43 million (143%).
  
  
• Our arrears remain low at 0.28% resulting in low levels of claims paid.
  
  
• On the supply side, interest rate pressures and building constraints continued to curb new construction activity. National housing starts posted a drop of 8% to 243,703 units over the period in 2023, just below 2021 and 2022 levels.
  
  
• On 26 September 2023, the Government raised the annual limit for Canada Mortgage Bonds from $40 billion to up to $60 billion. This new measure will help to build up to 30,000 more rental apartments per year, which may further increase the growth in our multi-unit volumes.
  
  
• On January 1, 2023, we adopted IFRS 17 Insurance contracts (IFRS 17) as issued by the International Accounting Standards Board for the first time. We have applied IFRS 17 retrospectively and have restated our 2022 comparative results. This has had a significant impact on our financial results as further discussed in the quarterly financial report. * 2022 results have been restated for impacts of IFRS 17

The full Quarterly Financial Report is available?online. 

CMHC continues to deliver the National Housing Strategy (NHS), a 10-year initiative with investments of more than $82 billion, giving more Canadians a place to call home. The NHS covers the entire housing continuum, from shelters and transitional housing to community and affordable housing, to market rental and homeownership. CMHC reports progress on the achievement of NHS targets quarterly online.

CMHC supports the housing market and financial system stability by providing support for Canadians in housing need, and by offering housing research and advice to all levels of government, consumers, and the housing industry in Canada. Follow us on Twitter, YouTube, LinkedIn, Facebook and Instagram.  

SOURCE Canada Mortgage and Housing Corporation (CMHC)