According to a recent survey, Canadians believe they will pay about $60,000 in interest over the life of their mortgage.
A poll conducted by Pollara for BMO asked respondents how much they expect to pay in mortgage interest. The national average was $57,938; of all the regions British Columbians think they will pay the most ($95,891), while those in the Maritimes believe they will pay the least ($35,454). The results in British Columbia reflect the higher real estate prices in the province, where in April the average housing cost was $623,000, compared with $437,000 nationwide.
Asked what they expect from interest rates over the next five years, 48% said they expect to see a small increase, while 12% said they anticipate a large increase. The survey also revealed that 67% of Canadian mortgage holders currently have a fixed rate mortgage.
As for when Canadians plan to have their mortgages paid off, the average age was 59 (an increase from the average age of 58 reported in the last two years), while 31% expect they will still to be making mortgage payments when they are 65.
"It's quite telling of the extended low-rate environment that a sizeable percentage of respondents do not expect interest rates to go up in the next five years," says Sal Guatieri, Senior Economist at BMO Capital Markets. "Hopefully, many have not been lulled into thinking that rates will never go up, as they could be tempted into taking on too much debt."