Mortgage affordability worsens in most major Canadian cities, report says

It became harder for Canadians in most major cities to afford a mortgage in February, a new report by Ratehub.ca found on Thursday.

“This is the first time since June of last year where we’ve seen affordability worsen in most cities,” Ratehub’s mortgage expert Penelope Graham said.

Only Vancouver and St.

John’s, N.L., saw affordability ease in February, while Montreal, Halifax, Hamilton, Victoria, Fredericton, Ottawa, Calgary, Regina, Toronto, Edmonton and Winnipeg saw affordability worsen.

As the Iran war raises oil and energy prices around the world, some experts are warning that additional stress may be on the way for Canadians looking to renew their mortgages this year.

The country is in the middle of a mortgage renewal wave, with the Canada Mortgage and Housing Corporation estimating that at least 1.5 million households had already renewed their mortgage by the end of 2025 and a million more are set to do so in 2026.

Generally, when investors fear inflation, that drives bond yields up and, in turn, raises mortgage rates.

“Once oil prices skyrocketed in reaction to hostilities in and around Iran, yields followed suit.

This matters because lenders use bond yields to price their fixed mortgage rates,” said Clay Jarvis, NerdWallet Canada’s mortgage expert.

According to Ratehub, the lowest five-year fixed mortgage rate increased to 3.99 per cent, while the lowest five-year variable mortgage rate was 3.35 per cent.