Feb 10, 2026
Canada’s long-anticipated mortgage renewal wave is now well underway, and for many households, the financial adjustment is proving tougher than expected.
More than 1.5 million Canadians have already renewed their mortgages at higher interest rates, with another million expected to do so over the next year, according to Canada Mortgage and Housing Corporation (CMHC) (1). While most homeowners are still managing their payments, the strain is starting to show, particularly in certain regions and among specific types of borrowers.
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“While most Canadians have been resilient in facing significantly higher interest rates at renewal, this comes at greater long-term expense,” said Tania Bourassa-Ochoa, deputy chief economist at CMHC, in a statement. “The majority extended the length of their mortgages to lower their monthly payments and manage short-term household finances.”
Where mortgage strain is showing up most clearly
National mortgage arrears — payments overdue by 90 days or more — have been rising gradually since late 2023. That trend has attracted attention, but CMHC notes that arrears remain low by historical standards.
What matters more for homeowners is where those pressures are building.
CMHC’s analysis, drawing on Equifax data, points to Toronto and Vancouver as the most exposed markets heading into 2026. High home prices, elevated household debt and softer resale conditions have reduced the financial buffer many owners once relied on. In Toronto, a weaker labour market has added another layer of stress, making it harder for some households to absorb higher payments at renewal.
Other regions are telling a different story. Markets such as Montréal have seen relatively stable mortgage performance, while prairie cities show mixed outcomes tied more closely to local employment conditions than to housing prices alone.
Rather than being a nationwide problem, the renewal wave is revealing pockets of vulnerability, shaped by local housing markets, debt levels and job conditions.
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Get StartedPandemic-era buyers face the sharpest adjustment
Across the country, the borrowers feeling the most pressure tend to share a similar profile: First-time buyers who purchased during or shortly after the pandemic, particularly in high-priced markets.
These households often bought when interest rates were near historic lows and prices were elevated. Many are now renewing for the first time at significantly higher rates, with limited equity and mortgages that still make up a large share of their home’s value.
CMHC data shows that pandemic-era buyers are still falling behind on payments less often than the average homeowner. But arrears are rising faster within this group than among longer-tenured borrowers. Highly leveraged households face similar challenges, especially if income growth hasn’t kept pace with higher housing costs.
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At the same time, many homeowners have managed to stay afloat by making trade-offs, says CMHC.
At renewal, extending amortization periods has been a common strategy to keep monthly payments manageable. While that has eased short-term pressure, it also means carrying mortgage debt longer and paying more interest over time.
Strong income growth and a relatively resilient labour market have helped contain arrears so far, though CMHC notes that rising unemployment — particularly if it spreads beyond younger workers — could change that picture. Canada’s mortgage stress test has also played a role, ensuring borrowers qualified at higher rates when they first took out their loans, which has limited how quickly arrears have climbed.
What homeowners should watch in 2026
Looking ahead, CMHC expects mortgage stress to remain concentrated rather than widespread. High-priced markets such as Toronto and Vancouver, along with households that bought near peak prices with minimal equity, are likely to remain under the most pressure.
For homeowners approaching renewal, the key considerations extend beyond where interest rates go next. Employment stability, household cash flow and the long-term cost of decisions like extending amortizations will matter just as much. Planning early, running realistic budget scenarios and understanding the trade-offs involved can help reduce surprises.
For most Canadians, the mortgage renewal wave hasn’t triggered a crisis, but it has quietly reshaped household finances. As we continue through 2026, the real challenge will be less about national averages and more about how individual households can manage to navigate higher costs in a persistently challenging economy.
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CMHC (1)
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Steven Brennan is a freelance finance writer based in Vancouver, BC. He holds a BA and an MA from Maynooth University, Ireland. His work regularly appears at Canadian Mortgage Trends, Lowest Rates, Loans Canada and other Canadian and US brands, while also working as a ghostwriter for financial influencers.
