Photo: David Ortmann/Flickr
Already high levels of household debt soared in Western Canada in 2014 with Albertans seeing the biggest year-over-year increase.
According to an annual debt report by the Bank of Montreal (BMO) and Pollara, Albertans were, on average, $124,838 in the red in 2014, a 40 per cent increase over last year. Their average debt load was also the highest in Canada, followed by British Columbia, which saw the average debt increase 26 per cent to $99,834.
Both provinces saw their average household debt rise far beyond the national average of $76,140. The average debt load for Canadians also saw an increase, albeit a less dramatic rise of 6 per cent.
Some provinces saw residents decrease their debt this year. In Ontario, the average amount dropped 12 per cent to $67,507, putting their debt levels at nearly half the amount experienced in Alberta. The Prairies saw the biggest reduction, with a $13,000 or 17 per cent decrease to an average of $68,437.
“Part of the reason household debt in Alberta is so much higher than in other provinces may be due to rapidly rising house prices, which have caused home buyers to take on larger mortgages,” said Sal Guatieri, Senior Economist, BMO Capital Markets, in the news release.
Albertans were also more likely to have mortgage debt, with 53 per cent of residents working to pay down their homes. Canada-wide, that number is 43 per cent, an amount that has increased by 13 per cent from last year. BMO believes the uptick is due to more millennials entering the real estate market.
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