• Statistics Canada’s Distributions of Household Economic Accounts (DHEA) contains a treasure chest of interesting facts and figures on the financial position of households. One trend that stood out for several quarters now is the steady decline in average mortgage balances of young families, even as mortgage debt has continued to rise for all other age groups.
• Since the peak in Q3 2022, average mortgage balances among households where the primary earner is under 35 years of age have fallen by $15.5k. Compared to Q1 2023, the reduction stands at $11k. Over the same period, mortgage balances increased by $18k for households aged 55-64 and by $4k for those aged 65 and older.
• The drop among younger borrowers appears to be at least partly explained by a decline in young people entering the housing market or opting for less expensive homes due to affordability challenges. Household formation in this age group has surged, growing at 2.5 times faster than other age groups in the last two years – yet many of these new households remain renters. According to Statistics Canada’ 2024 Canadian Social Survey more than half of young people reporting being very concerned about their ability to afford housing. Home ownership remains elusive for younger generations with 35% of young adults renting, compared to 23% of older aged group.

https://economics.td.com/ca-young-families-shrinking-mortgage