Posthaste: For some unlucky Canadians, 70% of their household budget goes to mortgage payments

The increase in interest rates has been especially hard for younger Canadian homeowners , as they are allocating as much as 70 per cent of their monthly household budget to their mortgage , according to a new survey by Rates.ca.

Of those aged 18 to 34, 56 per cent said they are now dedicating anywhere from half to almost three-quarters of their monthly household budget to their mortgages. Ninety per cent of those who renewed their loans said they were now paying higher interest rates, according to the survey of about 1,500 adults conducted by Leger in late July.

“These findings show just how little financial flexibility some homeowners have after renewing,” Victor Tran, Rates.ca mortgage and real estate expert, said in a press release. “When half or more of a household’s monthly budget is going toward the mortgage, there’s much less room to absorb other expenses or an unexpected financial setback.”

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But younger people aren’t the only ones feeling the squeeze, the survey said.

Of those who have renewed their mortgages since January 2025, 82 per cent said they are on the hook for a different rate, with most of the increases reportedly in the range of two per cent to 4.99 per cent, while 45 per cent said their mortgage payments accounted for more than half of their monthly budget.

These homeowners are the latest group to ride the mortgage renewal wave that was predicted by economists to hit Canada following the frenzy of home buying at ultra-low borrowing rates between the final quarter of 2020 and the first quarter of 2022.

Roughly 1.8 million mortgages were forecasted to come up for renewal between September 2025 and September 2026, cresting in June 2026, according to Robert Kavcic, a senior economist at BMO Capital Markets. Another smaller wave of renewals is expected in 2027.

Kavcic said in a BMO report that many of those renewing mortgages would “be coming off the lowest-of-low interest rates from five years prior,” with five-year fixed rates sitting below two per cent back in 2021 and variable rate mortgages at 1.5 per cent.