About one-third of Canadians with mortgages will face higher payments by the end of 2026, but a new report from the Bank of Canada says most people are prepared for the extra costs.
The report shows that 60 per cent of all mortgages in Canada are set to renew in 2025 and 2026. This means one in three mortgage holders will see their monthly payments go up.
Still, many Canadians have been saving more money. The study looked at “liquid assets” — money people can easily access, such as savings accounts, GICs, stocks, and mutual funds. Between 2019 and 2024, Canadians with mortgages increased their savings slightly, from 4.7 months of income to 4.8 months. Renters also built up more savings, going from 1.7 months of income to 2 months.
After interest rates rose in 2022, both renters and people with mortgages saved less, but those who already owned their homes outright kept their wealth stable.
The Bank of Canada says most homeowners would be able to cover the extra mortgage costs by using their savings. In fact, 94 per cent of households renewing their mortgages this year and next year could pay for the increase for at least 12 months using their financial assets. About 83 per cent could do so using only their liquid savings.
However, the report also warns that about 1 in 10 households only have enough liquid savings to cover one month or less. This shows that while many are ready, some Canadians could be under serious financial pressure after their mortgage renewals.
