The latest filings by the Office of the Superintendent of Financial Institutions showed that the outstanding balance of reverse mortgage debt throughout Canada reached $3.66 billion in April.
The figure was a new all-time high, and represented a 28.15% year-over-year increase in the total. Said level was “very large growth at a time when other credit segments are much lower,” Better Dwelling stated in its analysis of the OSFI numbers.
“As Canada’s population ages, more cash-poor, house-rich retirees are also going to be looking towards this segment.”
This is especially apparent when one considers the fact that the annual growth rate is actually slowing down to the most languid pace since October 2017.
“This is the sixth consecutive month we’ve seen the 12 month rate of growth decelerate,” the analysis added. “Even so, the pace of growth is still very, very high. Possibly the fastest growing segment of debt in the country, and hasn’t fallen below 10% in the past eight years.”
The data was concurrent with Canada’s HELOC loan balance reaching a historic high in April, exceeding the $300-billion threshold for the first time.
OSFI numbers indicated that the balance of this loan type reached $300.93 billion on that month, growing by 0.44% from March and by 7.56% from April 2018.
Most of this went to consumer debt for personal purposes, with spending on this sub-segment accounting for $268.38 billion of the April total. This was larger by 0.49% month-over-month and by 5.35% annually.