Ontario Mortgage Arrears To Keep Surging, Led by Toronto: CMHC

The Ontario real estate downturn is expected to worsen. Mortgage arrears in the province are approaching 2008 levels, according to the CMHC. The risk is even further amplified in Greater Toronto, especially with private lenders. The agency warns Ontario’s sharpest and most persistent surge in arrears will persist through mid-2027. Ontario’s Real Estate Boom and Bust Ontario was the center of Canada’s real estate bubble and now it’s the center of its bust. The low rate frenzy sent prices 64% (+$393.6k) higher between April 2020 and March 2022. Since then, prices have dropped 26.7% (-$268.8k), reversing most gains—but not all. That little nugget is important when it comes to making sense of the arrears data we’ll get to soon. But first, let’s make sure we’re all on the same page when it comes to mortgage arrears. The industry tends to frame rising arrears as a hard-hit consumer problem. In reality, households are hard hit during good times too. When someone can’t pay their mortgage, they typically try to sell. In a market boom, they sell pretty fast and feel like a genius when those profits flow in. When there’s a downturn, it takes longer to sell and not doing it fast enough means t...