Even most of those facing renewals are confident in maintaining payments
Canadian homeowners are making sure they keep up with their mortgage payments, despite the challenges of inflation and economic uncertainty.
A CIBC poll of homeowners has discovered that two thirds of those with a variable rate mortgage say they are unaffected with little or no impact on their standard of living.
Even 59% of those facing mortgage renewals are confident they can maintain their payments without breaking their budget, despite six in ten expecting rates to be higher (by an average expected 1-2%) as they renew in the next two years. Most will choose to renew with a fixed rate.
This week the British Columbia Real Estate Association published its quarterly mortgage rate outlook with expectation that rates would fall from an average 4.55% in the first quarter of 2025 to 4.50% in the second quarter, and 4.25% in the third quarter where it is likely to remain until at least the end of 2026.
"As mortgage rates are declining, it's encouraging to see that despite continued financial pressures, the majority of homeowners remain confident in their ability to manage their living expenses," said Daniel Rethazy, senior VP, Personal Lending, CIBC.
The CIBC research found that most respondents are concerned about inflation and living costs (94%), broader economic conditions (89%), interest rates (85%) potential US tariffs (80%), and election outcomes in Canada (70%).
But they are also determined to make monthly mortgage payments with 57% cutting back on discretionary spending such as travel and entertainment, 42% shopping for better mortgage rates, 24% seeking additional income sources, and 19% making lump sum payments towards their mortgages.
