ATB Financial’s Economics & Research Team has pulled some interesting data on mortgage debt from Statistics Canada.
According to the federal agency, after adjusting for inflation, median mortgage debt in Canada nearly doubled between 1999 and 2016. It went from $91,900 to $180,000 in 2016 constant dollars.
But ATB says that for families with a mortgage in the census metropolitan area (CMA) of Edmonton, the debt increased by 178 per cent between 1999 and 2016, compared to 119 per cent in the CMA of Calgary and 154 per cent in the rest of Alberta.
“The relatively high cost of housing in Calgary and Edmonton explains why median mortgage debt in the two CMAs is higher than the national level, at $260,000 in Calgary and $250,000 in Edmonton compared to $180,000 for Canada as a whole. Toronto has the highest level of median mortgage debt among the communities included in the study at $280,000,” ATB says in its daily economic update The Owl.
ATB says that about eight in 10 Calgarians and Edmontonians with a mortgage have a fixed rate compared to about nine out of 10 for families outside of Calgary and Edmonton.
“Homeownership rates in Calgary and Edmonton differ, with 67.5 of Calgary families owning their home in 2016 compared to 60.7 per cent in Edmonton. The homeownership rate for Alberta – excluding the CMAs of Calgary and Edmonton — was 69.4 per cent. At 50.5 per cent, Montreal had the lowest rate of home ownership among the communities included in the study. The Canadian average was 62.8 per cent,” the financial institution says.
“Statistics Canada attributes the increase of median mortgage debt to the rapid rise of house prices and low interest rates. With (inflation-adjusted) mortgages much larger than they were less than 20 years ago, there is concern that a rise in interest rates could make it difficult for some families to afford their mortgage payments.”