Statistics Canada reports that Canadian household debt rose in the second quarter of 2025, outpacing income growth and pushing the debt-to-income ratio higher.
The household credit market debt-to-disposable income ratio increased to 174.9% on a seasonally adjusted basis—up 1.1% from the previous quarter. This means Canadians owed $1.75 in credit market debt for every dollar of disposable income during the quarter.
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Meanwhile, the household debt service ratio—which measures total payments of principal and interest on credit market debt as a percentage of disposable income—also edged up, reaching 14.41%, compared to 14.37% in Q1.
Despite the rise in debt ratios, the pace of borrowing slowed. Total household credit market borrowing fell to a seasonally adjusted $31.6 billion, down from $34.5 billion in the first quarter.
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The total stock of household credit market debt, which includes consumer credit, mortgages, and non-mortgage loans, rose by 1%, surpassing $3.1 trillion. Mortgages continue to dominate, accounting for nearly 75% of the total.
A separate report from the Parliamentary Budget Officer (PBO) highlights the ongoing wealth disparity in Canada. Based on 2023 data, the PBO found that:
- The top 1% of economic families hold at least $7.4 million in net wealth, representing about 24% of the country’s total net wealth.
- The top 10% hold 53%, while the top 20% control 69% of all net wealth.
- In contrast, the middle 40% of families hold 27.6%, and the bottom 40% own just 3.3%.
The report noted a slight increase in wealth concentration between 2016 and 2019, but this trend reversed between 2019 and 2023. However, due to data uncertainties, the PBO concluded that wealth concentration in 2023 was either similar to or slightly lower than in 2019.
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