Mortgage debt behind rise in household debt

Canadian’s household debt continued its upward trajectory in the fourth quarter of 2015. The latest data from Statistics Canada shows that average debt rose by 1.5 per cent from the previous quarter to $263,200 per household.

The debt levels have been fuelled by increased mortgage debt with the total value of residential mortgages in Canada in Q4 2015 at $1.923 billion, up 1.2 per cent. Over the whole of 2015 households increased their mortgage debt by 6.3 per cent from 2014, the strongest growth since 2011. New mortgages totalled $21.9 billion in the quarter, up $1.2 billion from Q3 on a seasonally-adjusted basis.

The ratio of household debt to assets was 17.1 per cent and the ratio of household debt to income was up to 165.4 per cent; Canadians owe on average $1.65 for every dollar of income.

The interest-only debt service ratio continued around a record low of 6.2 per cent.

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