What Governments Should Do in Mortgage Markets

20 Pages Posted: 2 Mar 2011

Date Written: January 31, 2011


The federal government’s role in mortgage markets is pervasive and should be scaled back, while encouraging more competition in the mortgage insurance business, according to this study. The author notes that the mortgage insurance book of Canada Mortgage and Housing Corporation, CMHC, which is a Crown agency, now backstops mortgage lending equivalent to more than 30 percent of gross domestic product. While the net exposure is less than this, the arrangement subjects Canadian taxpayers to large, ill-defined risks. The author suggests several steps to manage these risks better.

Keywords: Financial Services, Canada, Canada Mortgage and Housing Corporation (CMHC), Mortgage Insurance

JEL Classification: G21, G28

Suggested Citation

Poschmann, Finn, What Governments Should Do in Mortgage Markets (January 31, 2011). C.D. Howe Institute Commentary, No. 318, January 2011. Available at SSRN: https://ssrn.com/abstract=1773680

Finn Poschmann (Contact Author)

C.D. Howe Institute ( email )

67 Yonge St., Suite 300
Toronto, Ontario M5E 1J8
416-865-1904 (Phone)
416-865-1866 (Fax)

HOME PAGE: http://www.cdhowe.org

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