Mortgages retain the largest share of household debt
Canadian households saw a modest rise in their debt levels relative to income in the first quarter of 2025, according to Statistics Canada, as borrowing continued but at a slower pace.
The ratio of household credit market debt to disposable income edged up to 173.9% on a seasonally adjusted basis, compared with 173.5% in the final quarter of 2024. This figure indicates that Canadians owed $1.74 in credit market debt for every dollar of disposable income.
Total borrowing slowed during the quarter. Households took on $34.5 billion in credit market debt between January and March, down from $41.6 billion in the previous three months.
Despite the deceleration in new borrowing, the total seasonally adjusted stock of household credit market debt increased 1.1%, reaching $3.07 trillion.
Mortgages continued to account for the largest portion of household debt, representing close to 75% of the total. The data cover all forms of credit market debt, including consumer credit, mortgage loans, and non-mortgage loans.
The household debt service ratio—the portion of disposable income allocated to required principal and interest payments—remained at 14.40% in the first quarter. This measure has held relatively stable in recent quarters, indicating that the amount households are spending to meet their debt obligations has not changed significantly despite shifts in borrowing levels.
The figures come at a time when many Canadians are adjusting to ongoing interest rate levels and cost-of-living pressures. Although the rate of borrowing has slowed, the gradual rise in the overall debt-to-income ratio suggests households are still relying on credit at a pace that slightly exceeds income growth.
Statistics Canada’s report is part of its regular analysis of household finances and is used by policymakers and financial analysts to monitor the financial position of consumers. The data do not provide a breakdown of loan types beyond the major categories but offer a general view of trends in credit usage.
No major shifts were observed in the debt service ratio, suggesting that repayment burdens, as a share of income, have not worsened in the short term. However, the rising debt-to-income ratio continues to be closely watched in the context of household financial health and borrowing behaviour.
