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WHEN BORING IS GOOD: YAWNING OVER LOW ARREARS RATES
With the exception of Alberta, mortgage delinquency rates across Canada are low and stable. Leading the way is British Columbia.
When homeowners begin defaulting on their mortgage payments, the horse will have already escaped from the barn, so to speak; at such a juncture, the economy’s downward trajectory is assured. Blessed be the trend, then, in British Columbia’s mortgage arrears rate (measuring the proportion of outstanding mortgages whose payments are behind by three or more months). Not only is BC’s arrears rate the lowest in Canada, at 0.09%—meaning only nine out of every 10,000 mortgages in
arrears—it has remained virtually unchanged over the past three years. The ability to make mortgage payments, mostly ensured through the earning of income, itself a function of the existence of employment, tracks closely with the unemployment rate. In BC, unemployment continues to trend at historically low levels (as in Canada as a whole), and with the province’s labour market expected to continue favouring workers over the coming year, BC’s mortgage market looks to be on a solid footing.
BC’S ARREARS LOWER THAN OUR PEERS’
0.60%
0.50%
0.50%
0.40%
0.30%
0.23%
0.20%
0.14%
0.10%
0.09%
0.00% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Q2 Q3 Q4 Q1
Q3 Q2 Q1
CANADA
ONTARIO ALBERTA
BRITISH COLUMBIA
SOURCE: CANADIAN BANKERS’ ASSOCIATION & LABOUR FORCE SURVEY, STATISTICS CANADA DATA: PROPORTION OF ALL OUTSTANDING MORTGAGES THREE OR MORE MONTHS IN ARREARS
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