2021 – Year in Review
As we turn the page on yet another tumultuous year headlined by Covid and its emerging variants, we wanted to take a look back at some of the top mortgage-related stories of 2021 and how mortgage rates fared.
Consumers grappled with rising prices in all aspects of the economy, including, of course, in Canadian real estate. As of November, the average price hit a record-high of $720,854, up over 20% from a year earlier. Rising prices led to record growth in mortgage credit over the year as homebuyers were forced to take out ever-growing mortgages.
And while fixed mortgage rates rose in 2021, they still remain low historically. That’s even more true for variable mortgage rates, which became the mortgage product of choice for a growing percentage of borrowers this year. But all eyes are looking ahead to 2022, with speculation abounding as to when and by how much the Bank of Canada will raise lending rates.
Here’s an overview of some of the year’s top stories, rate movements and mortgage-related stock performance.
Top Mortgage Stories of 2021
- Home prices soared in 2021 as demand outstripped supply (Story)
- Fixed mortgage rates climbed over the course of the year (Story)
- The Bank of Canada acknowledges high inflation could last longer than expected (Story)
- Mortgage credit reached new heights (Story)
- Borrowers faced a more stringent mortgage stress test (Story)
- Sagen overtook CMHC as Canada’s largest mortgage insurer (Story)
This Year’s Top Deals & Lender Moves
- MCAP Acquired Paradigm Quest and Merix (Story)
- Non-Bank Lender CMLS Launches a HELOC (Story)
- Mortgage Brokers Get TD’s HELOC (Story)
- Newly Launched Fundible Allows Canadians to Buy Before Selling (Story)
- Meet Bloom, Canada’s Newest Reverse Mortgage Provider (Story)
- The Broker Channel Gets Another Prime Lender: Strive Capital (Story)
Rate Movements
The foundation for Canadian interest rates is the overnight rate, which finished the year where it began. Meanwhile, the most important benchmark for fixed-rate pricing—the 5-year government bond—ended the year up nearly 90 basis points, which resulted in higher fixed rates for many mortgage borrowers.
| Indicator | Year End | 2021 Change |
| BoC Overnight Rate | 0.25% | No change |
| Prime Rate | 2.45% | No change |
| Avg. 5-yr fixed rate on new insured mortgages1 | 2.12% | +20 bps |
| Avg. variable rate on new insured mortgages1 | 1.46% | -40 bps |
| 5-yr Posted Rate | 4.79% | No change |
| Mortgage Stress Test Rate | 5.25% | +46 bps |
| 5-yr Government Bond Yield | 1.26% | +87 bps |
Stock Moves
And finally, here’s a look at the performance of Canada’s big banks and public companies that make the majority of their revenue in the mortgage business.
| Big Banks |
Share Price |
2021 % Change |
Annual Dividend Yield |
| Bank of Montreal | $135.63 | +40% | 3.90% |
| CIBC | $146.69 | +35% | 4.37% |
| National Bank | $96.24 | +34% | 3.59% |
| Royal Bank of Canada | $133.81 | +28% | 3.57% |
| Scotiabank | $89.47 | +30% | 4.38% |
| TD Canada Trust | $96.732 | +34% | 3.66% |
| Mortgage Companies | Share Price |
2021 % Change |
Annual Dividend Yield |
| Atrium MIC | $14.12 | +11.6% | 6.36% |
| Equitable Group | $68.72 | +31% | 1.07% |
| Firm Capital MIC | $14.26 | +12% | 6.53% |
| First National | $41.48 | -0.24% | 5.66% |
| Home Capital Group | $39.16 | +31.9% | — |
| MCAN Mtg Corp | $17.26 | +9.4% | 7.92% |
| Timbercreek Financial | $9.57 | +10.64% | 7.18% |