Mortgage freedom dreams fading fast

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Many Canadians will carry mortgage debt into their retirement years, according to Royal Bank’s latest housing survey.

While three-quarters of Canadians surveyed for the poll said they want to be mortgage-free by age 65, more than half (57 per cent) said they expect to carry mortgage debt after the age of 55, and nearly one-third expect to carry debt after age 65.

Another one-third of Canadians who are 55 or older have at least 16 years left on their mortgage term, the bank found.

“Canadians want to be mortgage-free as they approach retirement age and beyond, but the reality is that it takes prudent planning and the right advice to stay on track,” said Claude DeMone, RBC's director of strategy for home equity financing.

The report also found that the majority of Canadians surveyed said they expected interest rates will remain steady over the next six to 12 months.

A low interest rate is the most important feature for 96 per cent of Canadians when choosing a mortgage, the report said.

The poll found that 46 per cent of Canadians were interested in fixed rate mortgages, up from 40 per cent in the first quarter of the year.

Interest in variable rate mortgages has grown to 29 per cent, 10 percentage points higher than the earlier survey.

Hybrid mortgages that have features of both fix-rate and variable mortgages was favoured by 25 per cent, down from 41 per cent.

About four in 10 Canadian homeowners said they had no mortgage— the highest level since 2006 and up from 38 per cent in the earlier survey.

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