Millennials who are saddled with debt such as costly mortgages might well bear the brunt of higher interest rates in the months to come, a new RBC report argues.
Older millennials, adults aged 35 to 44, had debt-to-disposable income ratios around 250 per cent in 2019, while Freestone noted that metric was roughly 150 per cent for the same age group in 1999.
Can confirm we’re sitting around 250% but this is after exercising significant restraint to not take on as much mortgage as the banks would have given us. Everyone I know who bought over the last couple of years went all out and I can’t imagine them being any lower than 300-350%.
So 800% is bad, right? Thing is, we secured the debt at 1% over 30 years, so it’s not hard to service. Thanks to inflation we’re basically being paid to have the loan. I think mortgage debt is in a very different bucket to other kinds of debt.
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So 800% is bad, right? Thing is, we secured the debt at 1% over 30 years, so it’s not hard to service. Thanks to inflation we’re basically being paid to have the loan. I think mortgage debt is in a very different bucket to other kinds of debt.
Are you in Canada? If so, who lends mortgages with a 30 year term?
800% is bad, if you’re Canadian and that’s all mortgage debt, you’ll have to renew at the new rates