A recent report reveals that Canadians are facing challenges in meeting their mortgage obligations, particularly in the expensive real estate markets of Ontario and British Columbia. According to Equifax Canada’s Market Pulse report released on Tuesday, there was a 32% increase in mortgage delinquency balances nationwide in the first quarter compared to the same period last year, with Ontario and British Columbia leading the provinces at 52% and 36%, respectively.
The report indicates that missed payment levels reflect significant financial strain in high-cost markets. Homeowners who have fallen behind on payments had an average delinquent non-mortgage balance of $54,000, marking a 4.6% rise from a year ago. The average delinquent mortgage balance also surged by 13.2% to $355,500.
In terms of insolvencies, there was an 11% increase in homeowner insolvencies compared to the fourth quarter of 2025. Insolvent mortgage holders carried an average non-mortgage debt of $82,400, with over 90% of them opting for consumer proposals instead of bankruptcy.
Despite the uptick in delinquency balances, the report notes that missed mortgage payments are infrequent, with the 90-plus-day volume delinquency rate standing at 0.22%, below levels seen before the pandemic.
Factors contributing to homeowners’ struggles with payments include higher interest rates, as observed by Rebecca Oakes, vice-president of advanced analytics at Equifax Canada. Oakes emphasized that rising interest rates have impacted mortgage holders, particularly as they come to renew mortgages at higher rates, leading to increased missed payment levels.
While Ontario and British Columbia have been facing challenges, provinces like Quebec and Saskatchewan have seen a decrease in missed payment levels. Oakes suggested a potential rise in delinquencies as mortgages come up for renewal at elevated rates, highlighting the importance of interest rate stability.
Overall, the report indicates that insolvency volumes have reached the highest level since 2009, with a notable 18.8% year-over-year increase in insolvencies for the first quarter of 2026. Despite Canadians demonstrating financial discipline to navigate economic difficulties, systemic risks persist.
Ron Butler, principal broker at Butler Mortgage and host of the Angry Mortgage podcast, attributed the surge in delinquencies to a combination of factors, including declining home values, higher interest rates, and challenges in the job market. He mentioned that individuals impacted by job insecurity and reduced earnings are more likely to face mortgage delinquencies.
Butler also highlighted the situation of housing investors, pointing to Brampton, Ont., as an example where delinquency and foreclosure rates are elevated due to investment properties intended for international students. Despite the rise in delinquencies, financial institutions are not yet alarmed, as the trend, though significant, remains manageable for banks.