People living in Alberta cities have more consumer debt than others in Canada

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Credit rating agency Equifax Canada says average consumer debt increased 2.7 per cent to reach $72,950 at the end of 2019 as the pace of non-mortgage debt slowed.

Non-mortgage debt — which includes credit cards, loans and lines of credit — edged up one per cent to $23,800, largely due to lower use of lines of credit.

A report by Equifax found that those living in Alberta’s major cities carry more consumer debt (excluding mortgages) than anywhere else in Canada.

Data from Equifax’s fourth quarter of 2019 shows people in Calgary have an average debt of $29,789 and in Edmonton, it’s $28,350. Up north in Fort McMurray, the average debt in Q4 of 2019 was $39,674.

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Over the same time period, the average delinquency rate in Calgary was 1.37 per cent, Edmonton’s rate was 1.6 per cent and Fort McMurray’s was 1.94 per cent.

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The rate of increase for non-mortgage debt was highest in Quebec, rising 2.03 per cent to $19,833, followed by Ontario at 1.91 per cent to $24,406. It decreased 1.46 per cent to $29,076 in Alberta and fell 1.12 per cent to $24,789 in Saskatchewan.

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In the mortgage market, Equifax Canada said the average new loan reached $289,000 nationally in the fourth quarter of 2019, an increase of 7.2 per cent from the prior year. The average new mortgage in Toronto rose by a record 8.5 per cent to $448,000 while Vancouver mortgages rebounded from two years of decreases to gain 7.4 per cent to $455,000.

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The national delinquency rate (the percentage of credit users missing at least three payments) rose to 1.19 per cent for non-mortgage debt, 11 per cent higher than 2018. The delinquency rate increased 14.4 per cent in British Columbia, 14 per cent in Ontario and 13.3 per cent in Alberta.

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Mortgage delinquency rates were at 0.18 per cent at the end of 2019, the highest fourth-quarter level since 2016 but low in historical terms.

“Outside of mortgages, we have seen a significant pull back in demand for credit,” said Bill Johnston, vice-president of data and analytics at Equifax Canada.

“Adjusting for population growth, non-mortgage debt did not even keep pace with inflation in the last half of 2019. That is a significant slowdown from the torrid pace set in Q1.”

On Wednesday, the Bank of Canada cut its key interest rate by half a percentage point to 1.25 per cent due to the substantial negative shock to the Canadian and global economy caused by the outbreak of COVID-19.

— With a file from Global News


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