COVID-19: The impacts on global residential mortgage markets

The impact of the COVID-19 pandemic on the financial services sector and individuals’ wealth and debt levels is becoming more severe. For individual homeowners, mortgage debt is the single largest source of debt and has the greatest effect on their finances, and their ability to stay solvent through wage decreases or wage losses. For lenders, mortgages are typically the most significant asset on their retail banking book, and thus changes in originations, repayment schedules, and default rates will have significant impacts on their profitability and liquidity.

This report from Deloitte Canada—COVID-19: The impacts on global residential mortgage markets, examines the immediate effects and ongoing challenges faced by lenders, and how both governments and leading institutions are responding to the crisis and recovering. The actions taken by institutions fall under three general themes: responding to influxes of volume; managing and stabilizing business risk; and positioning for recovery. Nine immediate-term responses of mortgage lenders to COVID-19 include:

The study also explores global economies with large residential mortgage markets and significant exposure to COVID-19, including Australia, Canada, China, Europe, Latin America and the Caribbean, the United Kingdom, and the United States. The report is built on a foundation of interviews with major lenders and Deloitte experts across these regions, as well as secondary research on the latest developments on coronavirus and the residential mortgage market.

Read the full report to learn how we can assist you in navigating these disruptions faster.