About one-third of Canadians with mortgages on their primary residences say they are more anxious about their upcoming renewal than they were at their previous renewal, as the final wave of pandemic-era mortgages reaches renewal.
A Royal LePage survey found 35 per cent of respondents feel more anxious about their upcoming renewal, while 43 per cent feel about the same as they did at their previous renewal. The survey also found 38 per cent expect their monthly mortgage payment to rise when they renew, including 12 per cent who anticipate a significant increase.
Higher payments expected
The findings come as the last major group of five-year, fixed-payment mortgages taken out during the period of exceptionally low interest rates comes up for renewal. Royal LePage said these mortgages represent about 12 per cent of all outstanding mortgages in Canada.
Although mortgage rates have fallen from their two-decade highs reached in mid-2023, many homeowners renewing now are still expected to face higher borrowing costs.
The share of borrowers expecting a higher payment has declined from early 2025, when 57 per cent of renewing mortgage holders expected their monthly payments to rise. In the latest survey, 31 per cent expect their payments to remain approximately the same and 17 per cent expect them to decrease.
"The pandemic-triggered era of ultra-low rates came to an abrupt halt in early 2022, having lasted less than two years. While many Canadians who secured record-low mortgages during this period have already navigated their renewals, the final major group of rock-bottom rate holders are up for renewal, and understandably, they are concerned," said Phil Soper, president and CEO of Royal LePage.
"What we are finding in practice is that families are managing the transition. Borrowing rates have retreated significantly from their post-pandemic peaks, while salaries and wages have continued to appreciate. While some households are adjusting discretionary spending to accommodate higher monthly mortgage payments, the widespread default crisis many feared simply hasn't materialised – a testament in large part to Canada's prudent lending standards."
Borrowers in Saskatchewan and Manitoba were the most likely to expect higher payments, at 43 per cent, while Alberta had the lowest share, at 29 per cent. The figure was 39 per cent in Ontario, Quebec and Atlantic Canada, and 37 per cent in British Columbia.
"Many homeowners in Winnipeg expect their mortgage payments to increase at renewal, but that does not necessarily translate into financial stress. Our market doesn't have a lot of the same issues that we see in major markets like Toronto and Vancouver. It has remained relatively affordable compared to Canada's largest cities, and homeowners have benefited from strong price appreciation over the past several years," said Elliot Didomenicantonio, sales representative and associate broker, Royal LePage Prime Real Estate in Winnipeg. "Because of this stability, mortgage renewals are not a huge concern for Winnipeg homeowners. In fact, many people are in a strong enough position to actually refinance their homes to fund renovations or make other investments."
Anxiety varies by market
Anxiety was highest among homeowners who last renewed their mortgages in 2021 or 2022, when interest rates were at historic lows.
"Anxiety is concentrated right where you would expect it, among homeowners who bought or refinanced when the overnight rate sat at 0.25 per cent," said Soper. "Logically, no one expected rates to stay that low forever, but knowing a rate hike is coming intellectually and seeing the actual monthly dollar increase on paper are two very different things. Importantly, the vast majority of these 2021 borrowers were stress-tested at rates near five per cent or higher. They are moving into a rate environment they have already proven they can handle."
Federal mortgage qualification rules require borrowers to demonstrate they can afford payments at a rate higher than the rate offered by their lender. The survey notes that borrowers must currently qualify at the greater of their contract rate plus two percentage points or 5.25 per cent.
"Mortgage renewals are not a major source of concern for most of the clients I work with in Halifax. Many homeowners who purchased in 2021 qualified under the mortgage stress test at rates significantly higher than what they're renewing at today, so they are generally well prepared for higher borrowing costs," said Tanya Colbo, sales representative, Royal LePage Atlantic in Halifax. "While every situation is different, many buyers understand that the exceptionally low pandemic-era rates were temporary, and that preparation is helping make the renewal process more manageable."
In Vancouver, 45 per cent of respondents said they feel more anxious than at their previous renewal, compared with 39 per cent in Toronto. The figures were 34 per cent in Montreal and 32 per cent in Calgary.
"Anxiety around mortgage renewals tends to be greater in British Columbia because outstanding mortgage balances are often much larger. The same increase in interest rates that adds a few hundred dollars to a monthly payment in other parts of the country can have a much greater impact in Metro Vancouver," said Adil Dinani, sales representative and team lead of the Dinani Group, Royal LePage West Real Estate Services in Greater Vancouver.
"Even so, most homeowners are looking for ways to stay in their homes rather than sell to reduce their housing costs. When payments put pressure on the household budget, many are exploring practical options, whether that is generating rental income, adjusting spending, or in some cases selling an investment property. People are adapting to changing conditions rather than making rushed decisions."
Households adjust budgets
Among borrowers who expect their mortgage payment to increase, 76 per cent said the higher payment would put pressure on household finances. Forty-six per cent described the expected strain as slight, while 30 per cent anticipated significant strain.
Alberta had the highest proportion of borrowers expecting financial strain among those anticipating higher payments, at 82 per cent. Quebec had the lowest, at 65 per cent.
"The mortgage renewal crisis and subsequent market correction many anticipated has not become a reality in Montreal. Instead, higher rates have become a household budget issue – one that the vast majority of homeowners are managing," said Sean Broady, certified real estate broker, Royal LePage Altitude in Montreal. "A homeowner who signed a mortgage at two per cent several years ago may now be facing a monthly payment that is hundreds of dollars higher. Yet, strong employment, accumulated home equity and Montreal's comparatively affordable housing market have allowed most people to hang onto their homes.
"We're through the worst of it. Today, we're seeing homeowners adapt by tightening discretionary spending, holding off on upsizing or extending amortization periods in order to absorb the higher interest costs. But, what we are not seeing is panic selling or high rates of loan mortgage defaults in the region."
Among those anticipating financial strain, 58 per cent said they expect to reduce discretionary spending, 48 per cent planned to cut back on travel and 38 per cent intended to delay or cancel renovations.
"There is a meaningful difference between a household adjusting its budget and a household in financial distress," said Soper. "Trimming discretionary spending or delaying a renovation are choices made with room to spare; choices that reflect prudent planning rather than panic."
Delinquencies remain low
The survey found eight per cent of respondents had extended their amortization period to reduce monthly payments, while six per cent said they had missed or deferred a mortgage payment at least once during their current mortgage term. Of those who missed a payment, 19 per cent said their mortgage had been in arrears for 90 days or more.
Royal LePage cited Canada Mortgage and Housing Corp. data showing the national mortgage delinquency rate, defined as mortgages 90 days or more past due, rose from 0.21 per cent in the fourth quarter of 2024 to 0.24 per cent in the fourth quarter of 2025. The release said the rate remains below pre-pandemic levels.
"There was a lot of discussion about the impact of pandemic-era mortgage renewals, but so far we haven't seen the level of market disruption that some expected. Distressed sales have remained relatively limited, and a stable job market in British Columbia has helped many homeowners prepare for higher borrowing costs," said Dinani. "In my experience, the conversations are less about mortgage rates alone and more about overall affordability and rising household expenses. Those feeling the greatest pressure tend to be homeowners who are already carrying higher debt levels or multiple properties."
Toronto's mortgage delinquency rate rose from 0.20 per cent to 0.29 per cent between the fourth quarters of 2024 and 2025, according to the release.
"Many feared that mortgage renewals in this period would be significantly worse for a lot more Canadians. The reality is much less scary: the mortgage stress test has actually saved a lot of households from being in a far more difficult position," said Tom Storey, sales representative and head of The Storey Team, Royal LePage Signature Realty in Toronto. "That said, a certain percentage of homeowners simply won't be able to afford their renewal and will be forced to sell. In Toronto, we're already seeing power of sale occurrences increase compared to previous years, and this is usually a lagging indicator. Even when we get past the final wave of the hardest-hit mortgage renewers, we could still see a steady stream of defaults for a year or so afterward."
Borrowers weigh renewal choices
The survey found 70 per cent of respondents currently have fixed-rate mortgages and 29 per cent have variable-rate mortgages. At renewal, 43 per cent plan to choose a fixed rate, 16 per cent expect to choose a variable rate and 39 per cent intend to review their options before deciding.
Nearly half, or 49 per cent, expect to remain with their current lender, while 44 per cent plan to compare lenders.
"Interest rates remain an important part of the conversation, but they are only one piece of the affordability picture," said Natosha Wareham-Bakker, sales representative, Royal LePage Benchmark in Calgary. "Homeowners are taking a broader look at their finances and asking how much they want to dedicate to housing over the next several years. For many, the goal is to ensure their housing costs leave room for the rest of their financial priorities. In most cases, the renewal itself is not driving the decision to move. Rather, it serves as a natural point to reassess their options and plan for the next stage of life."
Most plan to stay put
Despite the prospect of higher payments, 71 per cent of respondents said they are not considering changing their living arrangements to reduce housing costs.
Among the 22 per cent considering a change, seven per cent are considering moving to a more affordable region, five per cent are considering renting out part of their home and another five per cent are considering downsizing.
"Most homeowners facing renewal are deciding how to fit a higher payment into their budget, not whether they can afford to keep their home," concluded Soper. "Home ownership remains a deeply held priority for Canadians, and as this final group of pandemic-era mortgages renews, we see no evidence this is changing."