First-time buyers now choose mortgage brokers 48% of the time, what banks aren't saying
A 32-year-old accountant in Brampton walked into her bank last month expecting to renew at roughly the same rate she'd locked in during 2021. The renewal letter quoted 5.8%. Her broker found her 5.1% at a credit union forty minutes later. She is not an outlier.
Mortgage brokers captured 38% of total originations in Canada last year, up from the low-thirties just three years prior. Among first-time buyers specifically, that figure jumped to 48%, meaning nearly half of new entrants to homeownership bypassed their primary financial institution entirely. The gap between those two numbers reveals where the real shift is happening.
The squeeze is tightest at the entry point
First-time buyers face a compounding problem. Prices remain elevated relative to income. Rates, while off their 2023 peak, still sit in the 5.5-6.5% range for most five-year fixed products. The federal stress test requires qualification at roughly two percentage points above contract rate, which means a household earning $110,000 annually can borrow materially less than the same household could have borrowed in 2020. The math doesn't work the way it used to, and banks have not adjusted their advice infrastructure to match the complexity buyers now navigate.
Brokers stepped into that gap. A first-time buyer today needs to understand FHSA contribution limits (currently $8,000 annually, $31,000 lifetime), RRSP Home Buyers' Plan withdrawals, how stress test qualification changes across lender types, and whether a B-lender at 6.2% beats an A-lender denial. Banks automate or productize most of this. The mortgage specialist at the branch has fifteen minutes and a script. The broker has an incentive to close the file, which means solving the qualification problem.
The result is measurable. Broker share rose across all provinces in 2025, signaling a national behavioral shift rather than a regional quirk. Growth wasn't confined to expensive markets like Toronto or Vancouver, where higher loan amounts might justify the advisory overhead. It showed up in Calgary, Halifax, and Winnipeg. Wherever renewals from the 2020-2021 origination wave started hitting, borrowers shopped around instead of auto-renewing.
What changed wasn't just price sensitivity
Mortgage Professionals Canada's data shows borrowers are citing "expert advice" as a primary motivator at rates comparable to "lowest rate." That's new. Five years ago, the broker value proposition was almost entirely price discovery, scan thirty lenders, find the best number, done. The 2025 buyer is asking different questions: Can I port this if I move provinces in two years? What happens to my payment if I go on parental leave? How does a variable rate with a fixed payment actually work when the Bank of Canada cuts again?
Banks have the infrastructure to answer these questions, but they've routed most mortgage interactions through digital-first workflows that optimize for speed and cost reduction, not for explaining second-order consequences. A chatbot can tell you your rate. It cannot tell you why a 4.9% rate with a three-month penalty clause might cost you more than a 5.1% rate with a portable feature if your employer relocates you in eighteen months.
The advisory gap is structural, not accidental. Branch networks are expensive. Mortgage specialists who can hold a thirty-minute conversation about portability and prepayment privileges are expensive. Automating the renewal process so that 60% of customers just click "accept" on the letter is cheap. The math worked when retention rates were high. Retention rates are no longer high.
The Big Six still hold the majority of mortgage assets in Canada, but their grip on new originations, especially at the entry tier, is loosening faster than their renewal advantage can compensate for. A first-time buyer who goes to a broker in 2026 is a renewal the bank will have to win back in 2031, and they're starting that fight from behind.
