Driven by the declining approval rates from the big banks, The Greater Toronto Area saw an 8% increase of private lending for new mortgages, according to Reuters.

This comes after Canadian regulators tightened the rules for home buyers, and this could "make the new guideline less effective in mitigating the vulnerability for the financial system as a whole,” the central bank said.

While the shift to unregulated mortgage providers is a concern, the growth opportunities for private lenders are limited, even as their volume remains stable, as the increase is due to the decline in lendings from larger banking institutions.

The central bank said that private lenders would need to improve their lending channels and operations, as well as “materially expand their funding sources" in order to increase their activities further.


Related stories:
British Columbia's housing tax foreseen to affect market prices
National Bank joins the mortgage war


Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate