Canadian consumers piled on their winter credit
June 11 2019 - 6:00AM
Equifax® Canada’s latest report on the health of the consumer
credit market shows Canadians remained highly reliant on debt to
start 2019. Average debt per Canadian consumer (including
mortgages) reached $71,300 in the first quarter of 2019, an
increase of 2.6 per cent over the same period last year. The
proportion of Canadians posting higher credit balances compared to
the previous year also reached a seasonal peak of 33.9 per cent, up
significantly from 2018.
Total consumer debt including mortgages increased to $1.907
trillion in Q1, compared to $1.823 trillion in Q1 2018 (+4.3%).
Mortgage growth has been slowing since late 2017, with total
outstandings up 4 per cent to $1,278 trillion. Non mortgage debt
was up 4.9 per cent compared to 2018, as longer terms on auto and
bank loans have consumers paying down their balances slower.
“Consumers were opening fewer new credit products in early 2019,
but they certainly weren’t curtailing the use of their existing
credit,” said Bill Johnston, Vice President of Data & Analytics
at Equifax Canada. “Loans are taking longer to pay down and credit
card use is on the rise. The headline numbers for non-mortgage debt
had been driven by population growth for the past 18 months, but it
was increased usage that drove the rise in credit during the first
quarter of this year.”
Delinquency marched higher
The 90-day-plus delinquency rate turned up in Q1 to 1.12%
(+3.5%), as was expected after a small rise at the end of 2018.
Seniors continued to lead the way higher with their 90-day-plus
delinquency rate up 9.4 per cent compared to the same period in
2018. The sharpest increase in delinquency was noted in
Newfoundland (10%), New Brunswick (7.8%) and Manitoba (6.1%). B.C.
(5.4%) and Ontario (3.6%) reported the first significant increase
in their delinquency in 5+ years.
Mortgage delinquency posted a second consecutive increase in Q1
2019, but remains at very low levels. The 90-day delinquency rate
was up 4 per cent to 0.18 per cent. Manitoba led the way higher
with a 21 per cent increase, while B.C. (14%) and Newfoundland
(14%) also reported strong increases. There is evidence that the
delinquency trend is gaining upward momentum.
“We continue to see signs of increasing strain for Canadian
borrowers. The utilization of credit cards has been trending higher
and gaining momentum,” added Johnston. “With more consumers growing
their average debt, we expect to see further increases in
delinquencies in the coming months.”
Mortgage markets felt an extended chill
The mortgage market has been slowing considerably over the past
year. The value of new mortgages was down almost 12 per cent
year-over-year in Q1, extending the trend to six straight quarters.
Quebec is the only province not feeling the weight of the mortgage
stress tests. British Columbia has been the most impacted with an
extended downtrend.
The cumulative impact of the increased regulations has been
pulling average mortgage values down. The average new mortgage in
Q1 2019 was $268,480, a drop of 3.2 per cent from last year.
Regulations have been most impactful in the expensive Vancouver and
Toronto markets. Vancouver reported a 6.2 per cent drop in the
average new mortgage value to $418,280. Toronto was down 1 per cent
to $401,830. Affordable markets have been less impacted. The
average new mortgage was up 3.6 per cent in Montreal and 2.5 per
cent in Ottawa. Similarly, Hamilton (2.4%) and London (5.2%) have
reported continued growth in mortgage amounts.
Debt (excluding mortgages) & Delinquency
Rates
Age |
Average Debt (Q1 2019) |
Average Debt Change Year-over-Year (Q1 2019 vs. Q1 2018) |
|
Delinquency Rate (Q1 2019) |
|
Delinquency Rate Change Year-over-Year (Q1 2019 vs. Q1 2018) |
|
18-25 |
$8,677 |
2.2% |
|
1.68% |
|
0.1% |
|
26-35 |
$18,062 |
2.4% |
|
1.61% |
|
3.4% |
|
36-45 |
$28,506 |
3.1% |
|
1.28% |
|
2.8% |
|
46-55 |
$35,527 |
4.2% |
|
0.94% |
|
2.2% |
|
56-65 |
$29,873 |
3.9% |
|
0.84% |
|
3.4% |
|
65+ |
$16,288 |
4.2% |
|
0.99% |
|
9.4% |
|
Canada |
$23,496 |
3.2% |
|
1.12% |
|
3.5% |
|
Major City Analysis – Debt (excluding
mortgages) & Delinquency Rates
City |
Average Debt (Q1 2019) |
Average Debt Change Year-over-Year (Q1 2019 vs. Q1 2018) |
|
Delinquency Rate (Q1 2019) |
|
Delinquency Rate Change Year-over-Year (Q1 2019 vs. Q1 2018) |
|
Calgary |
$29,905 |
2.1% |
|
1.26% |
|
8.0% |
|
Edmonton |
$28,374 |
4.7% |
|
1.49% |
|
2.2% |
|
Halifax |
$23,573 |
-0.1% |
|
1.62% |
|
9.6% |
|
Montreal |
$17,796 |
2.6% |
|
1.22% |
|
1.0% |
|
Ottawa |
$22,595 |
2.7% |
|
0.93% |
|
-1.6% |
|
Toronto |
$23,047 |
5.0% |
|
1.16% |
|
3.6% |
|
Vancouver |
$26,629 |
2.8% |
|
0.74% |
|
9.9% |
|
St. John's |
$25,266 |
0.3% |
|
1.70% |
|
12.7% |
|
Fort McMurray |
$39,007 |
3.3% |
|
1.86% |
|
8.0% |
|
Province Analysis - Debt (excluding mortgages)
& Delinquency Rates & Bankruptcy Amount
Province |
Average Debt (Q1 2019) |
Average Debt Change Year-over-Year (Q1 2019 vs. Q1 2018) |
|
Delinquency Rate (Q1 2019) |
|
Delinquency Rate Change Year-over-Year (Q12019 vs. Q1 2018) |
|
Ontario |
$24,032 |
4.5% |
|
0.99% |
|
3.6% |
|
Quebec |
$19,410 |
2.2% |
|
1.01% |
|
0.9% |
|
Nova Scotia |
$22,546 |
0.3% |
|
1.82% |
|
4.4% |
|
New Brunswick |
$23,467 |
1.2% |
|
1.84% |
|
7.8% |
|
PEI |
$23,043 |
1.8% |
|
1.35% |
|
2.7% |
|
Newfoundland |
$23,778 |
0.6% |
|
1.81% |
|
10.0% |
|
Eastern Region |
$23,134 |
0.7% |
|
1.79% |
|
6.6% |
|
Alberta |
$29,117 |
3.4% |
|
1.41% |
|
4.3% |
|
Manitoba |
$18,815 |
1.6% |
|
1.42% |
|
6.1% |
|
Saskatchewan |
$24,853 |
0.1% |
|
1.52% |
|
2.3% |
|
British Columbia |
$24,854 |
2.4% |
|
0.89% |
|
5.4% |
|
Western Region |
$25,761 |
2.6% |
|
1.20% |
|
4.5% |
|
Canada |
$23,496 |
3.2% |
|
1.12% |
|
3.5% |
|
About EquifaxEquifax is a global information
solutions company that uses unique data, innovative analytics,
technology and industry expertise to power organizations and
individuals around the world by transforming knowledge into
insights that help make more informed business and personal
decisions. Headquartered in Atlanta, Ga., Equifax operates or has
investments in 24 countries in North America, Central and South
America, Europe and the Asia Pacific region. It is a member of
Standard & Poor's (S&P) 500® Index, and its common stock is
traded on the New York Stock Exchange (NYSE) under the symbol EFX.
Equifax employs approximately 11,000 employees worldwide. For more
information, visit Equifax.ca and follow the company’s news on
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The information in this press release is published by Equifax
Canada Co. © 2019 All rights reserved. This press release is for
informational purposes only and is not legal advice and should not
be used, or interpreted, as legal advice. The information is
provided as is without any representation, warranty or guarantee of
any kind, whether express or implied. Equifax will not under any
circumstances be liable to you or to any other person for any loss
or damage arising from, connected with, or relating to the use of
this information by you or any other person. Users of this
informational publication should consult with their own lawyer for
legal advice.
Contact:
Andrew FindlaterSELECT Public
Relationsafindlater@selectpr.ca(416) 659-1197
Tom CarrollMedia RelationsEquifax
CanadaMediaRelationsCanada@equifax.com (416) 227-5290
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