Spotlight on Canadians and Debt: Who's Vulnerable?
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Description: Spotlight on Canadians and Debt: Who's Vulnerable?
Spotlight on Canadians and Debt: Who's Vulnerable?
Debt-to-income ratios in Canada continued to rise since the 2008-2009 recession, while they declined in the United States over the same period.
| Year | Canada | U.S. |
|---|---|---|
| 2005 | 132.3 | 130.6 |
| 2006 | 137.2 | 135.3 |
| 2007 | 144.9 | 137.9 |
| 2008 | 150.3 | 131.7 |
| 2009 | 158.2 | 130.9 |
| 2010 | 160.6 | 124.1 |
| 2011 | 161.8 | 117.1 |
| 2012 | 162.3 | 111.4 |
| 2013 | 162.9 | 112.4 |
| 2014 | 164.7 | 108.6 |
| 2015 | 166.9 | 105.5 |
| 2016 | 175.3 | 105.9 |
| 2017 | 176.1 | 105.2 |
| 2018 Q3 | 174.7 | 101.9 |
In Victoria, Vancouver and Toronto, debt-to-income ratios exceeded 200% in 2016, which means a household with $50,000 in after-tax income had over $100,000 in debt.
| Census metropolitan area (CMA) | Household debt-to-income ratio (percent) |
|---|---|
| Moncton | 106 |
| Fredericton | 119 |
| Quebec | 131 |
| Montreal | 154 |
| Ottawa-Gatineau | 149 |
| Toronto | 210 |
| Hamilton | 183 |
| Kitchener | 124 |
| London | 113 |
| Winnipeg | 144 |
| Regina | 144 |
| Saskatoon | 139 |
| Calgary | 189 |
| Edmonton | 171 |
| Vancouver | 230 |
| Victoria | 240 |
Debt-to-income ratios were relatively high for those at the bottom of the income distribution in CMAs where housing prices have increased over the last few years.
| After-tax income quintiles | Household debt-to-income ratios (percent) |
|---|---|
| Montreal | |
| Lowest | 105 |
| Second | 101 |
| Third | 122 |
| Fourth | 172 |
| Highest | 173 |
| Toronto | |
| Lowest | 420 |
| Second | 230 |
| Third | 250 |
| Fourth | 270 |
| Highest | 162 |
| Vancouver | |
| Lowest | 400 |
| Second | 230 |
| Third | 180 |
| Fourth | 250 |
| Highest | 220 |
Over the last 5 years, home prices have increased notably in large CMAs.
- 43% in Canada
- 61% in Victoria
- 68% in Vancouver
- 58% in Toronto
Did you know?
- 8.4% of Canadian families have less than $500 in net worth in 2016.Footnote 1
- 18.6% of those in the lowest income quintile had less than $500 in net worth in 2016.
Stay tuned for more insights on Canadians and debt through our analytical publications.
Sources: Statistics Canada, Survey of Financial Security, 2016, and Table 38-10-0235-01; Board of Governors of the Federal Reserve System (United States), Table Z.1 Financial Accounts of the United States; U.S. Bureau of Economic Analysis, Table 2.1 Personal Income and Its Disposition, Quarterly and Annual; and MLS Home Price Index data from The Canadian Real Estate Association.
Note: Throughout this infographic, the term 'Canadian families' is used to describe economic families and persons not in economic families. Debt-to-income ratios at the national level were calculated based on concepts from the Macroeconomic Accounts and using disposable income. Note that estimates also include data from non-profit institutions serving households. Debt-to-income ratios by after-tax income quintile and census metropolitan area were calculated using after-tax income, based on concepts from the Survey of Financial Security, which defines after-tax income as total income (market income and government transfer payments) less income taxes (federal and provincial).
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