Fixed-mortgage funding costs eased this week—ever so slightly.

The impetus was two-fold:

1. continued blow-over of U.S. banking worries, and
2. more signs of disinflation (among other things, average core inflation slid from 4.8% to 4.5%, and preliminary March retail sales estimates looked grim).

Rental investors take note. The nation's sole default insurer for 5+ unit rental properties plans to make insured borrowing more expensive.

Check out these fat premium hikes below. They take effect June 19, 2023 and apply to CMHC's Standard Rental and MLI Select products.

Today's report...

•  Scotia tightens mortgage underwriting

   (An important follow-up to yesterday's "rumour.")

This & That

• Mortgage payment inflation is back: New mortgage payments—assuming 20% down on the average home value—have rebounded almost $400 a month. That follows a 12.1% jump in CREA's national average home price from the cycle low in January. Falling rates could eventually alleviate some of the affordability hit, but if home values keep creeping higher—a likelihood given lower rates, higher incomes, persistent supply scarcity and FOMO after a correction—Canada's affordability crisis will heat back up. Near-term, it looks like home prices in most markets will jump again this month. Other things equal, the more that happens, the more media will write about a price rebound and the more FOMO will drive demand.

Further to yesterday's speculation about Scotia's loan-to-value policy changes, it turns out that rumour became fact quicker than expected. In a memo the bank sent out a few days ago—which we received Thursday—it announced that it was implementing the changes this week.

(Banks don't typically notify MLN of policy changes like this, but we invariably find out before long.)

Here is what we now know...

What Scotia changed

Today's reports...

•  Glasslake brings unregulated U.S.-style financing to Canada

•  Housing starts are simply inadequate

(Click links above for stories)

This & That

In the vast sea of non-OSFI-regulated non-prime lenders, the newly-launched Glasslake Funding is unique.

For one thing, few can claim to have the backing it does. Glasslake is a wholly owned subsidiary of U.S.-based Bayview, a global investment firm with over $15 billion of assets under management.

It also has a vast appetite for harder-to-place property types and borrowers. Here's a quick look at what it can do.

Today's report...

Inflation slows to 4.3%. Brings incremental hope for lower rates

(Click link above for story)

This & That