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The impact of higher interest rates on mortgage payments

Author

Listed:
  • Maria teNyenhuis
  • Adam Su

Abstract

We investigate how the increase in interest rates since early 2022 is affecting mortgage payments. By November 2023, less than half of mortgage holders had faced higher payments. Many borrowers will see a sizable increase in payments at renewal, although income growth could help mitigate the impact.

Suggested Citation

  • Maria teNyenhuis & Adam Su, 2023. "The impact of higher interest rates on mortgage payments," Staff Analytical Notes 2023-19, Bank of Canada.
    • Handle: RePEc:bca:bocsan:23-19
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    File URL: https://www.bankofcanada.ca/2023/12/staff-analytical-note-2023-19/
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    More about this item

    Keywords

    Credit and credit aggregates; Financial institutions; Interest rates; Recent economic and financial developments;
    All these keywords.

    JEL classification:

    • D - Microeconomics
    • D1 - Microeconomics - - Household Behavior
    • E - Macroeconomics and Monetary Economics
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • G - Financial Economics
    • G2 - Financial Economics - - Financial Institutions and Services
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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