Financial Gap Widens Between Canadian Homeowners and Non-Homeowners: Equifax Canada Report
A recent report by Equifax Canada reveals a deepening financial divide between Canadian homeowners and non-homeowners, highlighting significant disparities in debt levels and credit payment behaviors.
Nearly 1.4 million Canadians missed a credit payment in the second quarter of 2025, marking a slight improvement from the previous quarter but still 118,000 more than the same period last year. Non-homeowners are disproportionately affected, with 1 in 19 missing at least one payment compared to 1 in 37 homeowners.
The gap in missed payments has more than doubled since 2019, with non-homeowner delinquency rates now 96% higher than those of homeowners, up from 45% in 2019.
Debt levels are also rising, particularly for non-homeowners, whose average non-mortgage debt has climbed to $22,147. Younger Canadians, especially millennials and Gen Z, face significant challenges, with average non-mortgage debt increasing by 2% to $14,304.
The 90-plus day delinquency rate for this younger cohort surged by 19.7% year-over-year, reaching 2.35%. Nationally, credit card balances hit a record $113.3 billion in June 2025, while total non-mortgage credit liabilities rose to $793 billion, up $29 billion from the previous year.
Rebecca Oakes, Equifax Canada’s vice-president of advanced analytics, attributes much of the financial strain to rising unemployment and economic uncertainty, including global trade issues. Many young Canadians are struggling to “stay afloat” amidst affordability crises driven by rising costs and limited access to affordable credit.
While homeowners have been relatively shielded due to low mortgage rates locked in during the COVID-19 pandemic, they may soon face higher payments as mortgages come up for renewal.
The report underscores a deepening financial divide, with homeowners maintaining a stronger financial position while non-homeowners and younger Canadians grapple with increasing debt and greater economic pressures.
Deepening Financial Pressures Across Canada
As the financial gap between homeowners and non-homeowners continues to expand, the broader economic implications for Canadians are becoming increasingly evident. The Equifax Canada report highlights that while the overall delinquency rate has begun to stabilize, the underlying pressures driving these trends remain unresolved.
One critical factor contributing to the growing divide is the impending renewal of mortgages that were taken out during the COVID-19 pandemic. Many homeowners who locked in historically low interest rates at the height of the pandemic are now facing the reality of higher mortgage payments as their terms come up for renewal. This shift could strain household budgets, potentially leading to increased financial vulnerability even among those who have so far been more insulated from the economic downturn.
The affordability crisis, particularly for younger Canadians, remains a central issue. Millennials and Gen Z are grappling with the dual challenges of rising costs of living and limited access to affordable credit. This has left many in these age groups struggling to manage their debt, with their average non-mortgage debt increasing by 2% year-over-year to $14,304. The 90-plus day delinquency rate for this cohort has surged by 19.7%, reaching 2.35%, signaling a growing inability to keep up with payments.
Nationally, credit card balances have reached a record high of $113.3 billion as of June 2025, while total non-mortgage credit liabilities have climbed to $793 billion, an increase of $29 billion from the previous year. These figures underscore the broader trend of escalating debt levels across the country, with non-homeowners shouldering a disproportionate share of this burden.
The report also sheds light on the broader economic uncertainty that is exacerbating these challenges. According to Rebecca Oakes, vice-president of advanced analytics at Equifax Canada, rising unemployment and global trade issues are key factors contributing to the financial strain faced by many Canadians. This economic instability has left younger consumers particularly vulnerable, with many finding it difficult to “stay afloat” amidst the rising costs and limited access to affordable credit.
As the financial landscape continues to evolve, the contrast between the relative stability of homeowners and the increasing struggles of non-homeowners and younger Canadians remains a critical concern. The report serves as a stark reminder of the growing economic divide and the need for targeted solutions to address the systemic challenges driving this disparity.
Conclusion
The deepening financial pressures across Canada underscore a growing economic divide, particularly between homeowners and non-homeowners. With mortgage renewals looming for those who secured low-interest rates during the pandemic, household budgets are likely to face increased strain. Younger Canadians, already burdened by rising living costs and limited access to affordable credit, are showing signs of financial distress, with non-mortgage debt and delinquency rates on the rise. As credit card balances and non-mortgage liabilities reach record highs, the need for targeted solutions to address these systemic challenges becomes increasingly urgent. The economic uncertainty fueled by rising unemployment and global trade issues further exacerbates these struggles, highlighting the critical importance of addressing the disparities driving Canada’s financial landscape.
Frequently Asked Questions
1. What is causing the growing financial pressures in Canada?
The growing financial pressures in Canada are driven by factors such as rising interest rates, mortgage renewals, increasing costs of living, and limited access to affordable credit. Economic uncertainty, including rising unemployment and global trade issues, further exacerbates these challenges.
2. How are mortgage renewals impacting homeowners?
Homeowners who secured low-interest mortgages during the COVID-19 pandemic are now facing higher mortgage payments as their terms come up for renewal. This shift is expected to strain household budgets and increase financial vulnerability.
3. Why are younger Canadians struggling financially?
Younger Canadians, particularly Millennials and Gen Z, are grappling with rising costs of living and limited access to affordable credit. This has led to an increase in non-mortgage debt, with the average non-mortgage debt for this cohort reaching $14,304, and a significant rise in delinquency rates.
4. What does the rise in credit card balances indicate?
Credit card balances in Canada have reached a record high of $113.3 billion as of June 2025, while total non-mortgage credit liabilities have climbed to $793 billion. This indicates escalating debt levels, with non-homeowners shouldering a disproportionate share of the burden.
5. What can be done to address these financial challenges?
Addressing these financial challenges requires targeted solutions, including policies to improve access to affordable credit, support for younger Canadians, and measures to mitigate the impact of rising interest rates and economic uncertainty. Reducing the economic divide between homeowners and non-homeowners is critical to ensuring long-term financial stability.
