A new survey commissioned by online mortgage marketplace ratefilter.ca shows that 62 per cent of Canadians asked say they are struggling to make ends meet and that they are spending more than 30 per cent of their pre-tax income on housing.
Mortgage rates have risen dramatically over the last year or so as the result of a succession of interest rate hikes by the Bank of Canada. Homeowners who carry a mortgage are feeling the pinch.
Interest rates were held at 5.0 per cent this week, but the Bank of Canada warned that it is prepared to start increasing rates again if necessary.
Andy Hill, co-founder of ratefilter.ca, says the pain is real, but he expects that things will improve over time.
He says some borrowers are facing tough decisions especially if they’re at the end of their rope and they lose their jobs. They may have to sell to start again by realizing the equity in their home. But, says Hill, “this should be a short term cycle…and we should, barring any large change, normalize at lower rates.”