This is despite September representing the second slowest year-over-year growth in nearly 20 years
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Financial institutions account for a significant volume of outstanding mortgages, according to a new analysis by housing information portal Better Dwelling.
Per fresh data from the BoC, Canadians owed more than $1.6 trillion in mortgages at these lenders as of September. While up by only 0.5% from the month prior, this was a 4.2% increase on an annual basis.
“The new balance is a new record high for the segment, and improvement from last year’s rate of growth,” Better Dwelling stated, but quickly added that it’s still “pretty far from the healthy level Canadians are used to.”
This is because last month represented the second slowest year-over-year growth for September since 2001. Fortunately, this might be changing soon.
“The 3-month annualized pace of growth reached 4.9% in September, about 16.7% higher than the current pace. This means the 12-month rate of growth is likely to increase in the short-term.”
Much easier credit has led to a spike in overspending among Canadians, with around 1.8 million households setting aside more than 30% of their incomes on housing, according to the BC Non-Profit Housing Association.
This came amid Canada’s average household debt ratio shrinking slightly to 177.1% of disposable income as of Q2 2019, slightly lower than the previous quarter’s reading of 177.6%. Canadians were also carrying a debt load of an average of $30,000 each during the second quarter – far above the $12,000 level roughly two decades ago.
