Demand for home mortgages in Canada has fallen to a 20-year low due to higher interest rates.
Statistics Canada reported that Canadian households added $11.2 billion in mortgage debt in the first three months of this year, the smallest increase since 2003.
The federal agency suggested that higher interest rates are limiting many households’ ability to access credit and take on a home mortgage.
The average mortgage rate charged by Canada’s six largest banks currently stands at 6.69%.
After pausing interest rate increases in January of this year, the Bank of Canada raised its trendsetting rate to 4.75% last week as inflation remains stubbornly high across the country.
More recent data shows that home prices and sales activity across Canada is tentatively rising heading into summer.
Statistics Canada also asked whether home purchases in Canada are being financed by non-mortgage means or outside the traditional bank system where credit is harder to secure.