A new report released by CIBC World Markets shows that Canadians are paying down their mortgages a lot faster than they’re being credited for. The report shows that homeowners are taking advantage of record-low interest rates to speed up their mortgage payments, and shorten amortization periods.
That means the debt-service ratio in the Canadian mortgage market — what it costs to carry a mortgage as a share of disposable income — is 7.3 per cent, one point higher than the 6.3 per cent officially used in calculations by the Bank of Canada.
This also means that the Canadian housing market is much more stable than previously been reported on in the media, and by the Bank of Canada. In saying that, Calgary’s real estate market has always been in a better standing than that of the rest of the country for this year.
“Despite a lethargic labour market and an unemployment rate that is still too high for the Bank of Canada’s liking, debt service performance in Canada has almost never been better.”
To read more about this report, check out this article by CTV Calgary. If you have questions about paying off your mortgage early, or about mortgages in general, you can contact me anytime or find me on Twitter.
