In its Q2 2025 Consumer Credit Trends call, Equifax said Canada\u2019s economy is showing strain as growth slows and households face higher living costs.<\/p>\n
\u201cGDP saw a noticeable decline in the second quarter, both overall and on a per-capita basis,\u201d said Rebecca Oakes, Vice-President of Advanced Analytics at Equifax Canada. \u201cThere are a lot of challenges in terms of trading conditions across Canada.\u201d<\/p>\n
Domestic demand has cushioned the macroeconomic outlook, with government spending and consumer outlays helping to prevent a deeper downturn, Oakes said.<\/p>\n
However, the labour market is weakening, with over 60,000 jobs shed in August<\/a> and unemployment rising to 7.1%, according to Statistics Canada.\u00a0<\/p>\n \u201cA rise in unemployment is a shock factor in terms of credit measures, such as payment behaviours,\u201d Oakes said, pointing to the fact that rising unemployment will directly influence many households\u2019 ability to meet higher mortgage payments.<\/p>\n On the credit side, Oakes noted that overall consumer debt is up about 3% year-over-year, though growth has slowed amid weaker population gains and tighter credit use.<\/p>\n Equifax also pointed to a growing divide between consumers with and without mortgages: debt kept rising for non-mortgage holders in Q2, while mortgage holders kept increases more contained.<\/p>\n Renewals, not new lending, driving mortgage activity<\/p>\n Equifax said Canada\u2019s total mortgage balance is about $1.9 trillion, up 2.4% year-over-year, with the average balance at $247,000.<\/p>\n The firm noted that even with lower rates and slight price drops, first-time buyers continue to sit on the sidelines in anticipation of improved affordability.<\/p>\n Even so, first-time buyer activity edged up 1.8% compared to last year, though participation fell in Ontario, B.C. and Alberta. Those entering the market are borrowing more, with the average first-time loan amount up 4% year-over-year to nearly $430,000.<\/p>\n \u201cMortgage growth remains sluggish, and overall a recovery has not yet materialized,\u201d said Swarnima Pandey, Analytics Insights Manager at Equifax Canada. <\/p>\n Instead, renewals have become the main driver of mortgage activity through the second quarter of 2025. Equifax data show renewals and refinancings surged 27% year-over-year, with new mortgage originations up 15.3% largely on the back of this renewal wave.<\/p>\n Pandey noted that in several markets, the bulk of renewals are resulting in payment shocks as borrowers leave ultra-low pandemic rates for mortgages that add hundreds to monthly costs.<\/p>\n While mortgage holders have largely kept other credit use in check, renewals are testing household budgets in ways not seen in more than a decade.<\/p>\n \u201cToday most renewals are in payment shock,\u201d said Pandey. \u201cBorrowers are renewing at much higher rates than their original loans, especially for those who secured fixed rates during the pandemic.\u201d <\/p>\n Risks concentrated in key markets<\/p>\n For lenders, Equifax stressed that the impact of renewals varies widely by region.<\/p>\n Delinquencies are concentrated in the provinces where home prices surged most during the pandemic, especially Ontario and British Columbia. Average loan values there are about 20% above the national average, leaving mortgage holders more exposed to rising rates.<\/p>\n Equifax reported Ontario\u2019s 90+ day mortgage delinquency rate reached 0.27% in Q2, while B.C.\u2019s was 0.19% \u2014 both higher than last year. By comparison, most other provinces remain below pre-pandemic delinquency levels, highlighting how risks are concentrated in the high-value markets.<\/p>\n \u201cHigh-value mortgages are the main culprit,\u201d Pandey explained. \u201cThe Canadian market overall looks steady, but the real risk is concentrated in the high-value markets that ran hottest during the pandemic.\u201d<\/p>\n Kathy Catsiliras, Vice-President of Analytical Consulting at Equifax, added that the slowdown in sales is compounding the issue. \u201cThe lack of sales activity in Ontario and B.C. has had a significant impact on overall mortgage lending,\u201d she said. With resale activity subdued, the market remains effectively on hold, awaiting either rate relief or an improvement in affordability.<\/p>\n Visited 475 times, 48 visit(s) today<\/p>\n credit trends<\/a> delinquencies<\/a> equifax Canada<\/a> Kathy Catsiliras<\/a> Market Pulse consumer credit trends<\/a> rebecca oakes<\/a> renewals<\/a> steven brennan<\/a> Swarnima Pandey<\/a><\/p>\n Last modified: September 10, 2025<\/p>\n","protected":false},"excerpt":{"rendered":"In its Q2 2025 Consumer Credit Trends call, Equifax said Canada\u2019s economy is showing strain as growth slows…\n","protected":false},"author":2,"featured_media":135518,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,46],"class_list":["post-135517","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/135517","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=135517"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/135517\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/135518"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=135517"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=135517"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=135517"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}