Some may be trying to live under their means for the first time in history, but according to the latest news, “Canadian household debt continued to rise in the second quarter (i.e., Q2, April to June; results aren’t in yet for Q3) as individuals took out more mortgages at historically low rates and obtained consumer loans...” Sept. 14, London Free Press.
Admittedly, homebuyers may feel they’re getting the deal of a lifetime (i.e., hysterically low mortgage rates may prompt hubby to say, “Come on, Dear. We can finally afford that big house in my favourite suburb.”) but... and this is a big but... there is a downside to taking the cheap mortgage plunge.
I agree with how the downside was reported in the Free Press: “Policy makers have warned Canadians against taking on too much debt, especially as interest rates can only go up over time and some may find themselves unable to afford their debt payments.”
We’re going the wrong way according to the numbers.
household debt compared to income is rising
the number of Canadians vulnerable to adverse economic shock is at the highest level in nine years
per capita net worth declined in Q2, including pension assets
government net debt and corporate debt-to-equity rose in Q2
though national net worth rose by 1.2%, fewer home owners can afford their assets
My recommendation: This would be a good time to look for a small house close to mass transit.
What recommendation would you make?
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2 comments:
Small house with large garden in a small town near a bigger city near a water way. HMMMM........St Thomas, Pt Stanley?
Mass transit will be $$$ as well as your gas dollars and I do not credit city planners with enough foresight to keep mass transit running.
So I believe in better relations with neighbours.
Anonymous, very interesting comment. I grew up in a small town and liked the close relationships that developed. I'm sure the same would happen today.
Today I'm spoiled - I live inside a small village, i.e., Wortley Village, inside London, w a bus stop 80 meters from my porch, and all the groceries and hardware I need less than 2 min. away by bicycle.
I don't know if there is a small town in Ontario that could pry me loose. But your suggestions are still excellent.
GH
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