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BMO survey suggests 2% interest rate hike worries nearly half of homeowners

BMO survey suggests 2% interest rate hike worries nearly half of homeowners

SOURCER:The Canadian Press

TORONTO - A Bank of Montreal study finds more than 40 per cent of Canadians surveyed are unsure about their ability to afford their homes in the case of a two per cent interest rate hike.

The survey, compiled for BMO by Leger Marketing, found 43 per cent believe an interest hike would either hamper their ability to pay or leave them on unsure footing.

But the report also found 57 per cent of respondents believe they could still afford their home if interest rates spiked two per cent.

The survey results come as some of Canada's biggest banks begin raising variable mortgage rates, even though the Bank of Canada's overnight interest rate remains unchanged.

That could signal the era of cheap borrowing that has encouraged many Canadians to take on houses they may not have been able to otherwise afford.

BMO anticipates that the Bank of Canada will begin increasing interest rates from the current one per cent next year.