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Home loans hit new highs in Canada amid real estate boom

In the fourth quarter, household debt market debt grew 1.9%, while household disposable income declined 1.3%.

In the fourth quarter, households increased their debt by $50.0 billion on a seasonally adjusted basis, including $46.3 billion in mortgages and $3.7 billion in non-mortgage debt.

Additionally, the household debt servicing ratio, which is calculated as a percentage of household disposable income as a percentage of the total bound payments of interest on debt market debt, increased to 13.84% from 13.55% in the third quarter.

New mortgages have given a huge boost to real estate activity, with the home loan market debt-to-income ratio reaching a record high of 186% by the end of 2021.

The figures will only add to concerns that record low interest rates are sprucing up the property market and threatening the country’s financial stability through loans, giving the Bank of Canada all the more reason to raise lending prices sharply. Are getting.

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