Mortgage Payments Are Up About 20%. Why Aren't Canadians Selling?

As of August 2026, most Canadians renewing a mortgage are paying roughly 16% to 28% more each month, and the great majority are not selling because of it. They cut travel, restaurants and non-essential spending first. Forced sales are up, but almost always because of a job loss or a collapsed investment, not the renewal alone.

I'm Moe Asgarian, a Toronto real estate broker, and renewals cross my desk almost every day right now. Here is what the numbers say, what people are actually doing, and what I tell clients whose renewal date is coming up.

Why the renewal wave is peaking now

Go back to 2020, 2021 and early 2022. That was one of the busiest stretches in the history of Canadian mortgage lending. Record numbers of people bought and borrowed, and rates sat at the bottom. Plenty of buyers locked five-year fixed terms at 1.5%, 2%, at most 2.5%. In Canada, most borrowers take two, three or five-year terms. A ten-year term exists on paper, but barely anyone takes it, so nearly every mortgage comes back around after a few years.

That brings us to 2026, when a large share of those cheap terms is ending. The wave started a few months before this was written in August 2026, it will likely peak around the coming winter, then fade through the middle of next year. Renewals never stop. The volume just drops until the next bulge builds.

How much more people are actually paying

Someone who borrowed in 2021 or early 2022 at around 2% is renewing at roughly 4% or a little more. There is a second group moving the other way: people who borrowed in 2023, at the top of the rate cycle, many of them at 5.5% to 6% on two or three-year terms. Those borrowers are renewing lower. Because the 2021 group is far larger, most people renewing now are facing an increase.

For most households the monthly payment has risen somewhere between 16% and 28%. It is not the same for everyone. It depends on whether they made extra payments, what the old rate was, how much principal they paid down, and other details. An increase of about 20% is common, and 20% is not a small number. When a payment jumps that much, the pressure is real.

Why homeowners are not selling

You might expect that pressure to push people out of their homes. It has not. There is almost no sign of a broad wave of forced selling. Most people have decided to keep the house even with a payment 18% to 20% higher. Plenty of them are unhappy. Plenty are angry about the cost. They still will not sell.

In plain terms, people cut other parts of their life before they give up the house. The entertainment budget shrinks. Fewer trips. Fewer restaurants. Non-essential purchases disappear. The home stays at the top of the list, and that is the clearest lesson so far: Canadian families will absorb a lot of financial pain to stay put.

When forced sales do happen

This does not mean power of sale and foreclosure files have vanished. The count is higher than it was. But when those files are examined, the renewal is rarely the only cause. There is almost always a second, bigger event beside it. Someone lost a job. Someone bought a property to rent to students and cannot find a tenant. Someone bought several preconstruction condos and is now dealing with lower values and closing problems. Someone owns a home whose value dropped hard.

Picture a buyer who paid $2 million for a house worth $1.4 million today, with $1.5 million still owing on it. Add a job loss and walking away starts to look like a decision rather than a failure. Forced sales come from a combination: lost income, a steep drop in value, empty investment units, or a major change in life circumstances. If rates climb sharply again and new terms come back above 5%, the picture could change. On the conditions of August 2026, the renewal wave by itself has not created a wave of selling.

What I tell clients before a renewal

Under the rules in place at the time of writing in August 2026, if you move your existing mortgage to another federally regulated lender at renewal with the same remaining balance and the same amortization, you do not have to pass the federal stress test again. That makes switching lenders easier and gives you more room to chase a better rate.

Your lender has to send renewal information at least 21 days before your term ends, usually with the proposed rate, the remaining balance and the end date. That letter is an offer, not a verdict. One of the most common mistakes is signing the bank's first number, because the opening renewal rate is not necessarily the best one. Get quotes from other lenders or talk to a licensed mortgage broker. A written offer from somewhere else is what gives you leverage with your own bank.

Do not ignore the letter either. If you sign nothing, some lenders roll you into a new term automatically, at a rate nowhere near the best available. Start looking about 120 days, roughly four months, before maturity. Some lenders will hold a rate for you in that window, so if rates rise you keep the older one. A renewal is also a good moment to attack the principal: depending on your contract you may be able to put a lump sum against the balance without a prepayment penalty, which means less interest and likely a lower payment next term.

If your renewal is close, do not just wait for the bank's letter. For a second opinion on your numbers, or if you are weighing whether to keep, refinance or sell, fill out the form at the bottom of this page or book a free consultation. Stay well and take care.