Canadian Mortgage Delinquencies Rise But Largely Boosted By Toronto

Mortgage troubles are on the rise in Canada, with delinquencies—situations where homeowners miss payments by 90 days or more—jumping sharply in the first quarter of 2025. While the national delinquency rate remains low by historic standards, it climbed to 0.22 percent, marking a four-year high. That’s a 22% rise compared to the same quarter last year, and represents an aggressive uptick from record lows at the end of 2022.

Despite the national numbers being modest, the main driver behind the rise is the Toronto market. In the Greater Toronto Area, delinquency rates have more than tripled in just over two years—now at their highest level in more than a decade. That’s a dramatic swing from the ultra-low levels seen in late 2022.

Experts say this is a sign of liquidity problems, not necessarily that Canadians are unable to pay. Homeowners usually can sell if they fall behind—delinquencies spike when sales slow and buyers vanish. That underlines a market cooling rather than widespread financial hardship.

Other major markets, like Montreal and Vancouver, continue to see rising delinquencies too, but remain below the national average. That contrast highlights how Toronto’s experience is both sharper and more acute compared to the rest of the country.

The rise comes with a broader backdrop: while Canadian delinquency levels still sit below those seen in 2019, the rapid pace of increase signals risk. Running into tightening credit, higher interest rates, and limited resale activity, Toronto is becoming a troubling focal point for mortgage-related strain.

Canada’s overall housing market now faces a test of stability. Though the delinquency rate is still low in absolute terms, the speed of the rise—especially in Toronto—suggests the real estate market may be more fragile than it looks. Observers will be watching whether this trend spreads or stabilizes as lending and housing conditions evolve.