CMHC CEO’s letter ruffles feathers as bankers say stricter mortgage rules could dash first-time homebuyers' hopes

In the letter, Siddall expressed disappointment that private market mortgage insurers did not follow CMHC’s lead of tightening standards on July 1 to curtail excess borrowing in uncertain times, and noted the Crown insurer was now ceding market share to these competitors.

Privately, some bankers said they are concerned Siddall’s stated intent of trying to protect Canada’s housing market and economy by reining in mortgage lending could backfire by interfering with demand by first-time homebuyers. Lenders are counting on new homebuyers, at least in part, to help offset defaults on the horizon once government-sponsored pandemic relief including wage replacement and subsidies for lost work winds down.

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