B.C. tenants evicted for landlord's use after refusing large rent increase to take over neighbouring suite
Ashley Dickey and her mother rented part of the same Coquitlam duplex in three different decades under three different landlords.
Move over credit card debt, there is a new financial focus for Canadians: mortgage debt.
Homebuyers have pushed new mortgages to unprecedented levels, according to a new report from Equifax Canada.
"Much of the growth in consumer debt, which stands at $2.08 trillion, up 4.78% from Q1 2020, has been driven by new mortgage growth particularly in B.C. and Ontario, which saw huge increases of 59.2% and 44.3% in volume respectively,” says Rebecca Oakes, assistant vice president of advanced analytics at Equifax Canada.
Low interest rates, a keen desire to move outside of urban centres, more demand than supply and even blind bidding wars have all conspired to ramp up competition, fuelling a housing frenzy.
So much so that in an effort to slow things down, the Office of the Superintendent of Financial institutions introduced on June 1 new guidelines on the qualifying rate for uninsured mortgages at a contracted rate plus two percentage points or 5.25%, whichever is higher. The intent is to slow things down by forcing potential homebuyers to save more money for a downpayment resulting in a little more wiggle room should rates go higher.
The effectiveness of the change should play out in future debt level reports.
Meanwhile, the irony is that for years the alarm bells were ringing that a potential day of reckoning would hit Canadians who had been spending beyond their means. Fears mounted that rates could go higher, compromising the ability to make payments. However, it wasn't a rate increase that forced Canadians to rein in their spending - it took a pandemic for many to change their consumer behaviour. Fewer places to spend money due to lockdowns and restrictions, lower costs working from home, fear of unemployment and even government benefits left many with extra cash and opting to pay down their credit cards, resulting in the average credit card balance dropping year over year by 9.9%.
The average consumer debt (excluding mortgages) dropped to $20,430 or 4.2% year over year.
Not only are balances dropping, the number of credit cards we hold is also on a downward trajectory. And younger Canadians who may have missed payments in the past have cleaned up their act with a drop in spending and paying off their credit cards.
Before we panic about the size of mortgages, mortgage payments delinquent 90 days or more dropped 19% year over year and stand at an all-time low with the exception of Vancouver, which showed a 14.6% increase and Fort McMurray, with a significant spike of 38%.
We are handling our debt levels well.
While the road to recovery is thought to be uneven, I refuse to think like "Chicken Little" and caution the financial sky is falling or about to fall.
I'm optimistic that as vaccines take hold, economies open up, and lessons are learned from a pandemic the appreciation of having a little financial flexibility in households will go a long way. Canadians are no longer spending as if there is no tomorrow. That can't be a bad thing.
Rates will ultimately go higher, many people will be fully weaned off government support but I believe we have changed.
The question is: will the housing market hold up, will rates increase in mid-2022 and will payments continue to be made?
Being house poor is a horrible feeling but for now, Canadians are holding their own.
Ashley Dickey and her mother rented part of the same Coquitlam duplex in three different decades under three different landlords.
A man who fell into a crevasse while leading a backcountry ski group deep in the Canadian Rockies has died.
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MPP Sarah Jama was asked to leave the Legislative Assembly of Ontario by House Speaker Ted Arnott on Thursday for wearing a keffiyeh, a garment which has been banned at Queen’s Park.
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The giant stone statues guarding the Lions Gate Bridge have been dressed in custom Vancouver Canucks jerseys as the NHL playoffs get underway.
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A family from Laval, Que. is looking for answers... and their father's body. He died on vacation in Cuba and authorities sent someone else's body back to Canada.
A former educational assistant is calling attention to the rising violence in Alberta's classrooms.
The federal government says its plan to increase taxes on capital gains is aimed at wealthy Canadians to achieve “tax fairness.”
At 6'8" and 350 pounds, there is nothing typical about UBC offensive lineman Giovanni Manu, who was born in Tonga and went to high school in Pitt Meadows.