From where we sit as Mortgage Underwriters at Skip the Bank, we’re working with many new and renewing clients who are nervous about the current housing market. When we hear these concerns, we want to address them with the information readily available to us. We base all our suggestions on history, data, and the insights at our disposal. Here’s what we’re seeing.
Consumer Confidence Index
The Consumer Confidence Index tells us how people feel about the economy, which influences how they manage their money. We know that this, in turn, affects economic growth and monetary policy decisions such as interest rates. When interest rates are impacted, we see mortgage rates change, which then influences consumer decisions around borrowing and real estate.
The latest numbers from Edge Analytics, for example, show that consumer confidence has been declining in Canada over the past few years. Most of this is likely due to the fact that rates are still higher than in recent years, and inflation continues to affect the cost of many everyday essentials. As a result, consumers are more likely to take on debt and less likely to save for the future.
In summary, consumer confidence is currently low in Canada, and the general sentiment around the market feels more negative than positive.
Beyond the Consumer Confidence Picture
While consumer confidence is a useful indicator of market health, it’s not the only one. It does not fully determine where mortgages and the real estate market are headed in the months to come.
Yes, people are more cautious—as the Consumer Confidence Index shows—and qualifying for mortgages is tougher than it has been historically. However, mortgage delinquencies continue to remain low
This indicates we’ve hit new lows when it comes to missed mortgage payments in Canada. It shows that despite higher interest rates, homeowners are prioritizing their mortgage obligations—often by cutting back on savings or spending. This is a positive sign that most homeowners are managing just fine.
What Is Hearsay vs. Facts?
All of this data shows that a lot of what we’re seeing and hearing is driven by fear. This is typical during times when both international and local political factors are influencing the average homeowner’s decisions. In fact, that fear may be driving the current slowdown more than actual financial constraints.
It’s not that people can’t buy homes—it’s that many believe they can’t or shouldn’t. According to Edge Analytics, inflation is finally cooling, but consumers are still holding back. Retail sales are flat, and spending on essentials like gasoline is down.
Our Market Isn’t Crashing
BUT — this isn’t a crash; it’s a correction. And in many ways, it’s healthy.
Further Proof Our Market Is Not Crashing
- Stable Home Prices
While some regions have seen price drops due to interest rate hikes, there hasn’t been a dramatic or widespread collapse in home values. National price corrections have been measured—not free-falling—especially when compared to historical housing crashes.
- Strong Labour Market
Unemployment remains low, and many sectors continue to add jobs. A stable job market supports consumer spending and the ability to maintain mortgage payments.
- Limited Housing Supply
In many major cities, housing supply remains tight, which puts a floor under price declines and prevents a full market collapse. Construction costs and zoning constraints have kept inventory levels low, supporting prices even in a high-rate environment.
- No Panic Selling in Real Estate
There’s no rush of listings or fire sales. Buyers and sellers are taking a “wait and see” approach—indicative of a soft landing, not a crash.
In Summary
Many Canadians are feeling uncertain about the housing market due to rising rates and economic pressures. But as mortgage underwriters at Skip the Bank, we see that the data tells a more balanced story—one that includes encouraging signs.
Lending is stricter, buyers are more thoughtful, and the market is cooling in a way that could bring some positive balance back.