Posthaste: Have interest rates forced Canadians to sell their homes?
Higher mortgage payments during the Bank of Canada’s tightening cycle have forced only a small number of Canadians to take drastic measures and sell their home.
A survey released last week from the real estate website Wahi found that 11 per cent of homeowners planning to sell are doing so because of the cost of living, while 37 per cent are looking to downsize and 25 per cent are looking to upsize.
“While it’s a challenging time whenever someone is forced to sell their home, the survey results indicate that this remains relatively uncommon in the Canadian housing market compared to other reasons for selling,” Wahi chief executive Benjy Katchen said in the report.
“The Bank of Canada’s recent rate cut should also provide some relief for homeowners.”
The desire for Canadian homeowners to downsize was no surprise, due to Canada’s aging population, the report noted.
Overall, 69 per cent of those looking to downsize are aged 55 and up. On the other hand, 94 per cent of those looking to upsize are younger than 55.
While interest rates have forced few Canadian mortgage holders to take drastic measures, times have been challenging, especially those with the variable-rate option.
In 2022, when the interest rate was 3.75 per cent, the Bank of Canada estimated that 50 per cent of variable rate borrowers had hit their trigger rate, meaning monthly mortgage payments were only paying off the monthly interest and not paying down the loan.
On June 5, the Bank of Canada trimmed rates for the first time in more than four years, which gives those with a variable-rate plan some relief.
Estimates from the real estate website Zoocasa show the average mortgage holder in Vancouver saves $166.20 per month, while folks in Regina save an average
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