Canada's mortgage performance resilient despite inflation, high rates: Fitch

By Ovunc Kutlu

ISTANBUL (AA) - Canada's mortgage performance remains resilient despite inflation and high interest rates, which have led to mortgage payment increases for half of homeowners, according to Fitch Ratings.

Canadians’ ability to service their mortgage debt is tied to employment, wage growth and their savings, which support their mortgage performance, the rating agency said Tuesday in a statement.

While more than 99% of Canadian mortgage borrowers are not seriously delinquent on their mortgages, only 0.19% were delinquent for more than 90 days as of February, according to the Canadian Banker’s Association, it said.

Delinquencies, however, have shown a slight uptick this year as unemployment increased, Fitch noted.

The agency said it expects unemployment rate climbing to 6.4% this year, from the current rate of 6.1%, before declining to 6.1% next year.

Delinquencies, when a borrower or homeowner of a mortgage loan is late on required mortgage payments, are anticipated rising to 0.25% - 0.3% before falling to the 0.2% - 0.25% range in 2025, according to Fitch.