An economist with ATB Financial says he’s not surprised that the number of delinquent mortgage payments in Alberta is up, but that we need to put the increase in perspective.
Canada Mortgage and Housing is reporting a 52 per cent increase in the number of late mortgage payments in Alberat this year compared to last, because of the economic slowdown.
But Todd Hirsch says it’s important to remember that in years past Albertans were the best in the country at making payments on time.
“In fact two years ago Alberta had the lowest default rate among any province, so when you’re starting from a very, very low number of people defaulting on mortgages or on consumer loans, it doesn’t take too many more to get a 52 per cent increase because you’re starting from such a low rate.”
Hirsch says the numbers are concerning, but Alberta has been through worse in the past.
“People are worried about the same situation in the 1980s occuring now. There’s some real differences between the’80s and now and the primary one is the mortgage rate itself-much, much lower mortgage rates today than there were in the 80s and that makes walking away from a mortgage less likely.”
CHMC’s second-quarter report shows payments on 1,487 mortgages in Alberta were three months or more overdue as of June 30th – up from 978 at the same time in 2015.