Household debt ratio sinks

Household debt-to-income ratio dips lower: Stats Can

Statistics Canada says household debt as a percentage of disposable income edged down in the fourth quarter.

The agency says Canadian households owed an average of $1.763 for every dollar of disposable income, down from the $1.766 in the previous quarter.

On a seasonally adjusted basis, total household borrowing declined $400 million to $26.2 billion for the fourth quarter from the previous quarter.

The household sector’s net worth rose by $186.5 billion to nearly $11.7 trillion, as the increased value of assets offset an increase in liabilities.

Demand for mortgage loans rose to $18.4 billion, while consumer credit and non-mortgage borrowing decreased to $7.8 billion.

The household debt service ratio, which measures how much income goes to paying interest and principal, rose to 14.98 per cent.

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