Mortgage debt in Canada is growing at the fastest pace since 2007

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(Bloomberg) – Canadians are picking up mortgages more than twice as fast as historically as the housing market appears to have died after the pandemic boom.

The total cost of home mortgages rose 1.2% to C $ 1.73 trillion ($ 1.4 trillion) in June, according to data released Thursday by Statistics Canada. This is the fastest monthly growth in real estate loans since 2007.

The surge in mortgages suggests Canadians were clamoring for more living space during the Covid-19 pandemic, bringing sales and prices to record highs. Due to lower interest rates, total outstanding real estate debt in the country has grown by 9.2% over the past year, the largest increase since 2008.

However, the increased borrowing rate is likely to slow along with the cooling of the Canadian housing market, where sales have fallen over the past four months. “There is usually a time lag between selling a house and actually obtaining a mortgage,” the statistics agency said in a statement.

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