More Canadian seniors are withdrawing real estate wealth to make ends meet. Office of the Superintendent of Financial Institutions (OSFI) filings show the balance of reverse mortgage debt soaring in October. The annualized pace of growth is now at the highest level it has been in at least 8 years.

Reverse Mortgages

Have all your money in your house, but you need some extra cash to hold you over until the sweet release of death? That’s exactly what reverse mortgages are for – house rich, cash poor seniors. The borrower borrows against the equity in their home, and receives either a lump sum or regular payment. They’re similar to a home equity line of credit (HELOC), but a reverse mortgage is for someone 65 or older, and the borrowing rates are generally higher than a HELOC. Oh yeah, and you don’t have to make payments on these loans.

A reverse mortgage might seem like a good idea, but consider the demographic it targets. Seniors aren’t likely to get a windfall of new income in their golden years. This makes it unlikely they’ll be able to pay back their loan in a timely manner. Since they don’t have to make payments, it may not seem like a problem. However, borrowing at a relatively high rate while not making payments is a quick way to vaporize your net-worth.

Canadian Reverse Mortgage Debt Tops $3.42 Billion

Canadians sent the balance of reverse mortgage debt soaring. There was $3.425 billion in outstanding reverse mortgage debt in October, up 11.57% from the month before. The balance represents a 57.46% annualized pace of growth, a huge jump from last year. Actually, it was a huge jump from any point – setting a new record.

Canadian Reverse Mortgage Debt

The total of reverse mortgage debt held by regulated finacial instituitions, in Canadian dollars.

Source: Regulatory Filings, Better Dwelling.

Both the monthly and annual increase are record setting. The monthly increase is the second largest observed in 8 years of data available. It’s also 844% larger than the median monthly pace of growth. The annual increase is the largest in at least 8 years, and 274% larger than the median pace. It almost looked like Canadians were slowing down, but it made a massive increase instead.

Canadian Reverse Mortgage Debt Change

The annual percent change of reverse mortgage debt held by regulated finacial instituitions.

Month	Percent Change
Jan 2011	20.81
Feb 2011	19.78
Mar 2011	19.12
Apr 2011	18.83
May 2011	18.74
Jun 2011	18.97
Jul 2011	18.37
Aug 2011	17.83
Sep 2011	17.9
Oct 2011	18.11
Nov 2011	20.45
Dec 2011	20.9
Jan 2012	18.96
Feb 2012	19.1
Mar 2012	18.37
Apr 2012	17.88
May 2012	16.89
Jun 2012	15.28
Jul 2012	15.31
Aug 2012	15.55
Sep 2012	15.09
Oct 2012	15.11
Nov 2012	14.43
Dec 2012	13.75
Jan 2013	13.85
Feb 2013	13.95
Mar 2013	13.75
Apr 2013	14.18
May 2013	13.51
Jun 2013	13.15
Jul 2013	13.39
Aug 2013	13.6
Sep 2013	13.29
Oct 2013	13.59
Nov 2013	13.32
Dec 2013	13.92
Jan 2014	13.72
Feb 2014	13.76
Mar 2014	13.92
Apr 2014	13.76
May 2014	14.77
Jun 2014	15.69
Jul 2014	15.09
Aug 2014	15.11
Sep 2014	15.1
Oct 2014	14.91
Nov 2014	14.83
Dec 2014	14.57
Jan 2015	14.65
Feb 2015	14.43
Mar 2015	14.19
Apr 2015	13.77
May 2015	13.58
Jun 2015	13.37
Jul 2015	14.47
Aug 2015	13.62
Sep 2015	13.35
Oct 2015	13.58
Nov 2015	13.22
Dec 2015	13.84
Jan 2016	13.7
Feb 2016	13.85
Mar 2016	15.01
Apr 2016	15.4
May 2016	15.26
Jun 2016	15. Steven Axford Steve Axford grew up in Victoria, BC and has always been active in his community. Steve is a Victoria Cougars Hockey Team alumni as well as a Victoria Shamrocks (intermediate) alumni. During his time.... Login To Leave A Comment Latest Blog Posts The 2020 Victoria real estate market year in review Posted by Steven Axford January 4 2021 0 comments A total of 631 properties sold in the Victoria Real Estate Board region this December, 57 per cent more than the 402 properties sold in December 2019 and a 20.6 per cent decrease from November 2020. Read More CMHC says annual pace of housing starts climbed higher Posted by Steven Axford December 23 2020 0 comments The annual pace of housing starts increased three per cent in October compared with September, Canada Mortgage and Housing Corp. said on Tuesday, although the increase was less than some economists Read More First-Time Home Buyer Incentive Posted by Steven Axford December 9 2020 0 comments The First-Time Home Buyer Incentive helps people across Canada purchase their first home. The program offers 5 or 10% of the home’s purchase price to put toward a down payment. This addition Read More First-Time Home Buyer Incentive Posted by Steven Axford December 9 2020 0 comments The First-Time Home Buyer Incentive helps people across Canada purchase their first home. The program offers 5 or 10% of the home’s purchase price to put toward a down payment. This addition Read More Property Search Location Types Single Family Condos Commercial Land Townhouse Pending Multi-Family Style Arts & Crafts California Character Condo Apartment Contemporary Contemporary,West Coast Cottage/Cabin Half Duplex Row/Townhouse Single Family Detached West Coast Beds Any 1+ 2+ 3+ 4+ 5+ 6+ Baths Any 1+ 1.5+ 2+ 2.5+ 3+ 4+ 5+ 6+ Min Min $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 $550,000 $600,000 $650,000 $700,000 $750,000 $800,000 $850,000 $900,000 $950,000 $1,000,000 $1,050,000 $1,100,000 $1,150,000 $1,200,000 $1,250,000 $1,300,000 $1,350,000 $1,400,000 $1,450,000 $1,500,000 $1,550,000 $1,600,000 $1,650,000 $1,700,000 $1,750,000 $1,800,000 $1,850,000 $1,900,000 $1,950,000 $2,000,000 $5,000,000 $10,000,000 Max Max $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 $550,000 $600,000 $650,000 $700,000 $750,000 $800,000 $850,000 $900,000 $950,000 $1,000,000 $1,050,000 $1,100,000 $1,150,000 $1,200,000 $1,250,000 $1,300,000 $1,350,000 $1,400,000 $1,450,000 $1,500,000 $1,550,000 $1,600,000 $1,650,000 $1,700,000 $1,750,000 $1,800,000 $1,850,000 $1,900,000 $1,950,000 $2,000,000 $5,000,000 $10,000,000 $15,000,000 Min Sqr ft 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 7,500 8,000 8,500 9,000 9,500 Min Acres 0 0.25 0.5 0.75 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Year Built Any 1900+ 1905+ 1910+ 1915+ 1920+ 1925+ 1930+ 1935+ 1940+ 1945+ 1950+ 1955+ 1960+ 1965+ 1970+ 1975+ 1980+ 1985+ 1990+ 1995+ 2000+ 2005+ 2010+ 2015+ Any Year Max Year Built 2021 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 Walkscore Any Somewhat Walkable Very Walkable Walkers Paradise Options Just Listed Walkable Fixer Upper Newly Built Open House Adult 55+ Green/Energy Star Horse Property Golf Course Pool Water Front Water View Views Foreclosures Shortsales Not Distressed Lease to Own No Strata Fees Seller Financing Fireplace 1+ Garage 2+ Garage 3+ Garage 1 Story 2 Stories 3+ Stories Deck Basement Master on Main Air Conditioning Furnished Allows Pets Keywords Search Contact Information Address: 301 -1321 Blanshard St Victoria, BC V8Z1J9 Phone: 250-858-8947 Search Blog Search Term Search Our Bloggers Steven Axford Posts Steven Axford 157 Posts eXp Realty - Victoria (BC) 250-858-8947 Should you require assistance in navigating our website or searching for real estate, please contact our offices at 250-858-8947. 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