Canadians have record-high mortgage debt. What happens when rates rise?


New numbers from Equifax this week confirmed what housing market watchers have known for a while now: Canadians are addicted to mortgage debt. Canadians took out 410,000 home loans in the second quarter. That’s the biggest quarterly jump on record, up 60 per cent compared with the same period a year earlier. Despite fears in the early days of the pandemic that COVID-19 could be a bucket of ice on Canada’s housing market, the opposite happened. Interest rates slashed to record lows, coupled with millions of Canadians cooped up at home suddenly needing more living space, acted more like gasoline on the housing market than water. The average price of a Canadian resale home topped $716,000 in March. While average prices have come down a little since then, they’re still well ahead of where they were before the pandemic.

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