Canadians will see mortgages rise. Can savings provide a buffer?
Canadians will see mortgages rise. Can savings provide a buffer?
One-third of Canadian mortgage-holders are set to see their mortgages increase by the end of 2026, but a new Bank of Canada report suggests the vast majority have already built up a buffer against the rising costs.
Previous Bank of Canada data suggest that 60 per cent of all mortgages in Canada are up for renewal in 2025 and 2026. One-third of all mortgage holders will see an increase in their monthly payments during this period.
But Canadians are saving more, a new report released Friday shows.
The report looks at liquid assets — money held in chequing accounts, savings accounts, guaranteed investment certificates (GICs), exchange-traded funds (ETFs), stocks, bonds and mutual funds —accumulated by both homeowners and renters.
Between 2019 and 2024, Canadians with mortgages saw their liquid assets go up from 4.7 months of income to 4.8 months. Meanwhile, renters saw their liquid assets rise from 1.7 months to two months.
After interest rates rose in 2022, mortgagors and renters both experienced reduced savings, while mortgage-free homeowners maintained their liquid financial wealth.
Total financial assets includes both liquid assets — money you can easily withdraw — and assets held in inaccessible accounts or accounts with complex, heavy withdrawal penalties.
While some homeowners would struggle to cover their higher mortgages with their savings, most would be able to dip into them.
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