More homeowners are reporting struggles and overall financial position is weakening
What the Bank of Canada decides to do with interest rates this Wednesday will have a profound impact on millions of Canadians who are already struggling to keep on top of expenses.
The escalation of rates from just 0.25% in March 2022 to its current 5% has piled pressure on consumers and businesses, but it’s those homeowners with mortgages that could face the biggest impact of rate hikes.
According to a new report from Angus Reid Institute published today (Oct. 23), 15% of respondents say the financial aspect of their mortgage is “very difficult” with this metric doubling from March this year.
Among those with a mortgage renewal ahead, 57% of those who will face this within the next year and 48% doing so in 1-2 years say they are very worried that it will cost significantly more, while around 9 in 10 say they are worried to some degree.
Housing costs are not only concerning mortgage holders though with 53% of renters reporting that meeting their monthly payments is “tough” or “very difficult”.
Financial health
Overall, 49% of poll participants say they are financially worse off now than they were a year ago and 35% expect to be worse off in a year from now.
More than half say they are finding it hard to feed their family, and two thirds say an easing of the cost of living can’t come soon enough.
Inflation and health care come ahead of housing costs in the survey and inflation is the top concern across Canada, led by Manitoba (74%), Saskatchewan (73%) and Alberta (69%).
Housing affordability is a bigger issue for younger Canadians (39% of men and 43% of women aged 18-34) than other age groups, while men aged 35+ are more concerned about taxes than other demographics.
