Increasing House Prices Continue
From coast to coast in Canada, over the past decade, housing prices have continued to rise. Data from Canadian Real Estate Association (MLS®), shows that the average residential price in Toronto in 2002 was $275,877 and in 2013 the average price was $454,089 with about a 90% difference in price from those years. Surprisingly, the Average Rent for Two-Bedroom Apartments in Toronto in 2002 was $1,047 and in 2013 was $1,213 for a 15.9% difference from those years.
Canadians are taking on more mortgage debt, and Canada’s federal housing agency stated to the finance ministry in 2014 that it has concerns regarding the increasing household debt and very high pricings in some of the urban markets.
Even with Canada tightening Government backed mortgage rules 4 times from the years 2008 and 2012, Canada’s debt to income ratio is at a record high for the 3rd quarter in 2014.
Not including mortgages, average Canadian debt is $20,891 according to a recent Equifax study, and Canadians household debt is 163% of their disposable income.
Also, in 2015 it is expected that interest rates on consumer loans, credit, and VR mortgages may rise. So if you are carrying high debt, working to pay off these debts sooner is a must. If you happen to get hit with a higher interest rate on any of your loans, it will take you longer to pay these off.
Pay Down Your Debts!
So, what can you do to help lessen your debt and help pay it down faster? First you want to stop your credit cards. You will need to determine how much you actually owe. Find out the exact total, so you can see what you are dealing with. Next, you need to arrange a strategy to start paying off your debts.
When paying off debts. A good place to start is paying off the credit cards that have the highest interest rates. These will be costing you more per month, and the sooner you can pay these off, then that frees up money that you can then use to pay off your other debts.
This is a great time to really think about your wants and needs. The want category tends to be the area that gets most people into trouble.
Next do you have items around your house that you are not using? This may be a good time to start selling them in the classifieds, and then use this extra money to pay down debts.
Another area you will want to look into is cutting your expenses, you can read more on expense cutting ideas. For more information on a wide range of topics, see our debt management section for more helpful ideas and tips to help your financial situation.
If you are in a situation where you need professional help or advice, call the offices of David Sklar & Associates to schedule a free consultation.