Mortgage, housing agency says home prices won’t recover from COVID for years

Mortgage, housing agency says home prices won’t recover from COVID for years

By David Paddon

THE CANADIAN PRESS

TORONTO _ Canada Mortgage and Housing Corp. officials said Tuesday they expect real estate prices won’t return to pre-recession levels until late 2022 at the earliest.

The housing agency also cautioned that the impact of the COVID-19 pandemic is unpredictable and beyond its worst-case estimates prior to the outbreak.

CMHC routinely does stress tests to estimate what could happen under various severe conditions, but chief executive Evan Siddall said the stress tests focus on what’s considered to be “plausible” scenarios.

“We did, back in January, look at a pandemic scenario that was not as severe as this,” Siddall said in a teleconference to discuss CMHC’s annual financial report for 2019.

“And I’m sure that you’d understand that the realm of plausibility has expanded significantly as a result of all the experience we’ve had.”

Siddall said the federal Crown corporation which provides market analysis for housing-related industries, mortgage insurance for lenders and funding for public housing projects is now revising its estimates on an expedited basis based on experience during the spring and summer.

He said preliminary figures indicate that about 10 per cent of homeowners across Canada have chosen to defer their mortgage payments, although the rate seems to be higher in parts of the country that rely heavily on the oil and gas industry.

“Tens of thousands of Canadians are having trouble meeting their mortgage commitments,” Siddall said.

Canadian Mortgage and Housing has given lenders the flexibility to extend mortgage deferrals by a further six months, he said, but the deferrals will mean that missed payments will be added to the total mortgage amount owing on terms determined by contractual agreement between lender and borrower.

CMHC chief economist Bob Dugan said that reliable forecasts are difficult to make because there are so many unknown variables, including how much income levels deteriorate because of unemployment, the timing of future immigration and how the construction industry responds.

“But for Canada and for Ontario, I think, the best case we’re looking at … house prices getting back to their pre-recession levels, at the earliest, by the end of 2022,” Dugan said.

The CMHC presentation came shortly after the release of April statistics for Canada’s largest real estate market.

The Toronto Regional Real Estate Board said April home prices in the Greater Toronto Area fell 11.8 per cent from March, when COVID-related shut-downs including open houses began to be put in place mid-month as Canada stepped up its fight to control the health impact of the coronavirus.

Prices for GTA renters were also down for the month, with the average one-bedroom rent falling 2.7 per cent to $2,107, and the average two-bedroom rent falling 4.1 per cent to $2,705 _ still high in comparison with many Canadian cities.

On Monday, Greater Vancouver’s real estate board said its composite price benchmark index was up 0.2 per cent from March, but that the number of sales hit the lowest levels in nearly 40 years  62.7 per cent below their 10-year average.

Other major cities will be releasing their local and regional figures ahead of a national tally to be published by the Canadian Real Estate Association on May 15.

Siddall said that recent federal emergency legislation will ensure CMHC gets the financial resources it requires to perform its functions which, for the first time, include assisting small businesses through a rent-assistance program announced last month.

However, he said, CMHC had ended 2019 with a strong financial position and said it continues towards a 2030 goal of ensuring all Canadians can get the housing they need at affordable prices.

In the meantime, he said, it’s likely that both incomes and home prices will “sag.”

“And it’s how those move relative to each other that will define the gap between where we are now post-crisis and where we will be.”

Document everything, insurance lawyer urges Albertans returning to flooded homes

Document everything, insurance lawyer urges Albertans returning to flooded homes

‘Take lots of photos, don’t take a denial at face value, make notes’

The excerpted article was written by CBC News 

As Northern Alberta residents discover the extent of flooding damage to their homes and businesses, a Fort McMurray lawyer offers a few practical tips that could pay off later in dealings with insurance companies.

Take photos. Make lists. Understand your policy. And don’t give up if your claim is initially denied.

“They’ve just been back to the property for the last day or two and the news is pretty heartbreaking,” said Christine Burton, a Fort McMurray lawyer who has worked through insurance issues with numerous residents in recent years.

“People are dealing with the shock and impact of cleaning up,” Burton told CBC Radio’s Edmonton AM on Tuesday. “We’re telling people, ‘Please, take lots of photos, don’t take a denial at face value, make notes. Stay safe.'”

More than 14,000 people were evacuated as a result of recent river flooding in and around Fort McMurray, as well as along the Peace River.

As people progress from clean-up to rebuild, it is critical that they understand their insurance policies, even if it means hiring a lawyer to work through “subtle” policy language, said Burton.

Most policies won’t include coverage for overland flooding, when water flows over dry land before entering a property through doors or windows.

“It’s often a special endorsement you can buy. It’s very often expensive,” Burton said. The cost depends on the flood risk in the area where you live.

However, property owners whose policy includes a special endorsement for sewer backup may be able to get some money from their insurance companies.

“Take photos of your basements, the drains, the sump pump. Make notes of everything that’s happening, make lists of everything that you’ve lost.

“Fort McMurray has become a little bit of an expert, unfortunately, at insurance claims through fire —  and we’re still dealing with some of those claims,” Burton said. “Don’t take a denial at face value. You can challenge this. Understand your policy.”

Don Scott, mayor of the Regional Municipality of Wood Buffalo, has said he expects residential damages from the flooding in Fort McMurray could top $100 million.

In a statement, the Insurance Bureau of Canada said overland and sewer backup coverage are the key parts of a policy that pertain to flooding events but both of these are optional and must be added to home insurance policies.

Properties in high-flood areas may not be offered the coverage, the statement said.

“If a home has flood damage from this event but did not purchase the optional overland flood insurance or it was not available as the area is high-risk for flood, the policy would not cover the damages,” Celyeste Power, vice-president for the insurance bureau’s western region, said in the statement.

Property owners not covered by insurance may be able to access provincial disaster relief funding. Alberta Premier Jason Kenney has said the provincial disaster relief program will likely be triggered for Wood Buffalo flooding.

Under that program, the government would provide some financial support for recovery costs for critical public infrastructure and non-insured private infrastructure.

Between 2009 and 2019, insurers paid out an average $1.9 billion per year on catastrophic flooding claims, compared with an average $422 million annually in the period from 1983 until 2008, according to Insurance Bureau data.

More than $2 billion in insured losses resulted from the June 2013 flooding event in southern Alberta, which caused $6 billion in damages and displaced 100,000 people.

CBC News

Insurance in Canada: Coronavirus (COVID-19) Sector Impact

Insurance in Canada: Coronavirus (COVID-19) Sector Impact

NEW YORKMay 4, 2020 /PRNewswire/ — Insurance in Canada: Coronavirus (COVID-19) Sector Impact

Summary

Read the full report: https://www.reportlinker.com/p05890931/?utm_source=PRN

‘Insurance in Canada: Coronavirus (COVID-19) Sector Impact’ report provides brief review of the key trends and evolving developments that shape the impact of the COVID-19 outbreak in the Canadian insurance industry.

‘Insurance in Canada: Coronavirus (COVID-19) Sector Impact’ report provides a snapshot of the impact on the Canadian insurance industry in light of the COVID-19 outbreak.

It provides the impact of COVID-19 on the Canadian economy, the key business lines impacted by the virus outbreak and the revised market sizing estimates against pre-COVID-19 forecast period (2019-2023) across business segments of life and general insurance.

The report brings together research, modeling and analysis expertise, giving insurers access to information on segment dynamics in the country.

Key Highlights
– Economic Impact.
– Impact of COVID-19 outbreak in the Canadian insurance industry.
– Key measures undertaken at both policy and regulatory level.

Scope
This report provides a comprehensive analysis of the impact of COVID-19 in the Insurance Industry in Canada –
– It provides historical values for the Canadian insurance industry for the report’s 2015-2019 review period, and pre-covid-19 projected and revised projected figures for the 2019-2023 forecast period.
– It offers an impact analysis of the key categories due to the COVID-19 outbreak in the Canadian insurance industry, and market forecasts and revised forecasts to 2023.

Reasons to Buy
– Make strategic business decisions using in-depth historic and forecast market data related to the Canadian insurance industry, and each category within it.
– Understand the key dynamics, trends and growth opportunities in the Canadian insurance industry.
– Identify growth opportunities in key product categories.

Read the full report: https://www.reportlinker.com/p05890931/?utm_source=PRN

About Reportlinker
ReportLinker is an award-winning market research solution. Reportlinker finds and organizes the latest industry data so you get all the market research you need – instantly, in one place.

__________________________

Related Links

www.reportlinker.com

SSQ Insurance sponsors mental well-being program Stronger Minds by BEACON

As Mental Health Week kicks off, SSQ Insurance is pleased to announce its contribution to the Stronger Minds by BEACON program as a way to support the mental well-being of Canadians. SSQ Insurance is now a proud sponsor of this free digital program, created to help during the pandemic through resources provided by a team of clinical psychologists.

Always committed to supporting its customers and the community, particularly during a period that is highly stressful for many, SSQ Insurance is lending its support as a sponsor of this program created to help with the specific emotional well-being concerns faced by the population. Launched at the beginning of April, this initiative has already provided valuable support to many people turning to the program for help coping with social isolation, stress, financial insecurity or the need to be resilient for the sake of their loved ones.

“We are already a BEACON partner, offering its digital cognitive behavioural therapy services. And now SSQ Insurance has decided to join forces with the Stronger Minds program and contribute to the development of this innovative tool, which meets a real need in society, given the new reality we are currently facing. The support of sponsors like SSQ Insurance allows BEACON to continue offering its program free of charge to the entire population, to promote it while contributing to its broader use,” said Éric Trudel, Senior Vice-President of Strategy and Product Management at SSQ Insurance.

We are very happy to have the support of SSQ Insurance and be able to continue developing this program to respond to the mental health needs of all Canadians and help them get through these difficult times. Canadians are in this together and we are here with them, and for them,” said Sam Duboc, Chair and CEO of MindBeacon Group.

Information about the Stronger Minds program is available at mindbeacon.com/strongerminds.

To help cope with worry, stress and fear, a number of resources are available to SSQ Insurance’s clientele during these difficult times. More information is available at ssq.ca/psychological-assistance.

About SSQ Insurance
Founded in 1944, SSQ Insurance is a mutualist company that puts community at the heart of insurance. With $13 billion in assets under management, SSQ Insurance is one of the largest insurers in the Canadian industry. Working for a community of over three million customers, SSQ Insurance employs 2,000 people. Leader in group insurance, the company also sets itself apart through its expertise in individual life and health insurance, general insurance and the investment sector. For more information, go to ssq.ca.

About MindBeacon Group
The MindBeacon Group of companies is dedicated to helping Canadians improve their mental well-being to live their best lives. MindBeacon provides evidence-based therapy that is affordable and easy-to-access through BEACON™, the guided digital therapy service (iCBT) which has helped thousands of Canadians struggling with depression, anxiety, insomnia and posttraumatic stress injury (PTSI/PTSD). MindBeacon provides in-person and video therapy through CBT Associates, a leading psychology clinic network.

SOURCE SSQ Insurance

Related Links

ssq.ca

Canada: Alberta Limitations Under The Insurance Act

On April 2, 2020, Field Law reported that the limitations periods in various statutes had been suspended due to the impact of COVID-19. We noted that certain statutes were not included in the suspension order including the Insurance Act. Field Law wishes to clarify that, pursuant to the Public Health Act, the only statutes that could be included in Ministerial Order 27/2020 are those under the authority of the Minister of Justice and Solicitor General. The Insurance Act was not included in the Ministerial Order as that legislation falls outside the Justice portfolio. At present, limitations under the Insurance Act continue to run and no suspension of the limitations under that Act has been ordered as of yet.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Field Law:

Drivers fear move by company will force them back to work to cover expenses despite health risks

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