Though they specialize in townhouses, one industry player is making a recommendation to CMHC that may save your clients 15 per cent on their housing insurance.
“TownHouses.ca has launched a new initiative to petition the Federal Government to lower Canada Mortgage and Housing Corporation’s mortgage default insurance premiums by 15 per cent,” a statement issued by the company said. “With the recent tightening of the mortgage guidelines by the Department of Finance has restricted the number of consumers who now qualify to purchase a home (and) these new guidelines imposed by the Government will help to make Canada Mortgage and Housing Corporation more profitable today and in the future.”
So with CMHC reaping the rewards of the tightened guidelines, so should clients, according to the statement.
“The Canada Mortgage and Housing Corporation is a highly profitable crown corporation and the mortgage insurance division has averaged over $1.1 Billion in Net Income over the past 5 years,” the statement said. “Given CMHC’s strong profitability over the past 5 years and a very positive future outlook, the mortgage insurance rates should be reviewed by the Federal Government (and) the recent tightening of the mortgage guidelines will make CMHC even more profitable going forward since they will have stronger credit quality in their portfolio which will translate into lower losses in the future.
The company is also calling for increased rebates for certain buyers, such as those purchasing their first homes and those purchasing a “green” home.
“CMHC should also consider offering special interest groups like First Time Home Buyers and those who purchase an Energy Efficient Home a premium reduction of up to 25 per cent,” it said. “CMHC’s current energy efficient housing rebate program of 10 per cent and complex process for obtaining the refund has resulted in a very low participation rate in this program.”
TownHouses.ca estimates that the total cost to CMHC would be $194 million.