1/3 Mortgage Renewers Anxious as Pandemic-era Terms Expire

One in three Canadians renewing their mortgage this year say they feel more anxious than at their previous renewal, though the wave of financial distress that many feared has largely not materialized.

A new survey for Royal LePage, conducted by Burson between July 20 and August 6, 2026, polled 1,127 Canadian homeowners facing renewal. It found that 35 per cent report heightened anxiety compared to their last renewal, while 38% expect monthly payments to rise when they sign their new terms, down sharply from 57% who anticipated increases in early 2025.

The shift reflects the Bank of Canada’s rate cuts, which brought its overnight lending rate from a peak of 4.25% at the end of 2022 to its current level of 2.25%, reached in October 2025.

“The pandemic-triggered era of ultra-low rates came to an abrupt halt in early 2022, having lasted less than two years,” said Phil Soper, president and chief executive officer of Royal LePage. “What we are finding in practice is that families are managing the transition.”

Pandemic-era borrowers feel the pressure most

Anxiety is highest among homeowners who locked in during 2021 and 2022, when the Bank of Canada’s overnight rate sat at just 0.25%.

Those borrowers are now confronting renewal rates that, while lower than the 2023 peak, remain substantially above where they started. Approximately 12% of all outstanding Canadian mortgages originated during the pandemic era, according to the Bank of Canada’s Households, Financial Stability Report — 2026, published in May 2026.

Of those expecting higher payments at renewal, 76% say it will strain household finances with 46% characterizing the strain as slight and 30% as significant. In response, 58% of affected borrowers plan to cut discretionary spending, 48% will scale back travel, and 38% are delaying or cancelling home renovation projects.

Still, the majority (71%) say they are not considering any changes to reduce their housing costs. Among the 22% who are, just seven per cent are exploring relocation to more affordable regions, five per cent are considering renting out part of their home, and 5% are weighing downsizing.

Regional variations paint a mixed picture

The financial pressure is not evenly distributed across the country. Saskatchewan and Manitoba show the highest proportion of borrowers expecting payment increases, at 43%, while Alberta sits at the opposite end at 29%. Ontario, Quebec, and Atlantic Canada each come in at 39% with British Columbia at 37%.

Adil Dinani, sales representative and team lead of the Dinani Group at Royal LePage West in Greater Vancouver, noted that anxiety tends to run higher in British Columbia given the scale of outstanding balances. “Anxiety around mortgage renewals tends to be greater in British Columbia because outstanding mortgage balances are often much larger,” he said.

Conversely, conditions in other markets have proven more stable than expected. Sean Broady, a certified real estate broker at Royal LePage Altitude in Montreal, said the anticipated correction did not arrive. “The mortgage renewal crisis and subsequent market correction many anticipated has not become a reality in Montreal.”

Delinquencies rising but remain historically low

National mortgage delinquency data from the Canada Mortgage and Housing Corporation’s Residential Mortgage Industry Report Spring 2026 Edition, published May 12, 2026, shows the 90-days-or-more past due rate rose from 0.21% in the fourth quarter of 2024 to 0.2%in the fourth quarter of 2025. In Toronto, the rate moved from 0.20% to 0.29% over the same period.

Eight per cent of current-term borrowers extended their amortization period to lower monthly payments, and six per cent missed or deferred at least one payment. Of that latter group, 19% fell 90 or more days into arrears.

Soper drew a clear distinction between these numbers and a systemic crisis. “There is a meaningful difference between a household adjusting its budget and a household in financial distress. Most homeowners facing renewal are deciding how to fit a higher payment into their budget, not whether they can afford to keep their home.”

Borrowers weigh their options

When it comes to product choice at renewal, uncertainty is high. While 70% of borrowers currently hold fixed-rate mortgages, only 43% plan to renew into fixed terms — with 39%still undecided. Sixteen per cent intend to switch to variable.

On the lender side, 49% plan to stay with their current provider, while 44% intend to shop around.

The mortgage stress test, updated by the Office of the Superintendent of Financial Institutions in January 2026, requires borrowers to qualify at the greater of their contract rate plus two percentage points, or 5.25% — a measure that has softened the blow for many households that would otherwise have stretched beyond their means.

Tom Storey, sales representative and head of The Storey Team at Royal LePage Signature Realty in Toronto, credited the stress test with limiting damage. “Many feared that mortgage renewals in this period would be significantly worse for a lot more Canadians. The reality is much less scary.”