Mortgage holders were reportedly using 41% of their pre-tax income for housing with 51% stating that they will not be able to survive more than 3 months without their main source of income. Sixteen percent (16%) said they will not be able to financially manage one month without their income. This was alarming as the unemployment rate in Canada held at 5.5%, according to Trading Economics.
“These statistics corroborate what we’ve been hearing anecdotally. Many Canadians feel like they’re at a breaking point due to higher interest rates,” said Andy Hill, co-founder of ratefilter.ca.
In the last 18 months, a series of rate hikes from the Bank of Canada had added to the financial strain felt by many Canadians. These increased have worsened the concerns surrounding housing affordability and financial stability.
“Even if the Bank of Canada pauses the rate hike, these borrowers will still be dealing with rates at a 20-year high,” said Hill.
The data from the report was based on an online survey conducted to 1,548 adult Canadians with 1,028 being homeowners and 650 being mortgage holders from October 13-16, 2023.