Research shows homeowners with an outstanding mortgage may be at particular risk
A significant number of Canadians say the COVID-19 pandemic has led to them being “house poor,” meaning that they don’t have much left over after paying bills related to their home, according to a new survey.
The latest MNP consumer debt index, which polled the attitude of 2,002 Canadians toward their consumer debt, found that almost half of respondents (45%) are not confident they’ll be able to cover all living and family expenses in the next 12 months without taking on more debt – with three in 10 (30%) saying the pandemic worsened their debt or created a larger debt burden for either themselves or their family (35%).
According to the survey, homeowners with an outstanding mortgage may be at particular risk – with a third (32%) of respondents saying they are house poor.
All told, approximately 5.5 million homeowners are susceptible to financial disruptions such as an interest rate increase or change to their job situation.
“Perhaps it is therefore not surprising that two in 10 (20%) homeowners say they regret the amount of debt they took on to buy their home,” said MNP.
“Those feeling overwhelmed by their bills should seek professional debt advice as the first step to getting their finances back on track,” said Grant Bazian, president of MNP. “As life slowly gets back to normal, the money management behaviours adopted during the pandemic can help all Canadians positively reshape their financial futures. Spend less, save more, and make emergency funds a priority.”