Photo: Nolan Issac
A new report finds many Canadians are struggling to keep up with home repairs, including residents of Mississauga.
Higher home costs with increased mortgage rates due to Bank of Canada key interest rate hikes mean many homeowners are looking for ways to cut back.
The Bank of Canada key interest rate now sits at five per cent — the last increase was in July.
The report from MyChoice, an insurance comparison rate comparison website, also finds that Home Equity Line of Credit rates, as of December 2023, now exceed 7.5 per cent — a stark increase from the historical low of 2.35 per cent in 2021.
MyChoice compared cities across Ontario to find out what communities are struggling the most with home maintenance.
The disparities in home maintenance across Ontario cities might affect province-wide home insurance rates, MyChoice notes.
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This latest study draws from the 2021 Census data and finds many homes are in need of major repairs.
Mississauga falls somewhere in the middle of the ranking — number 23 — with 4.8 per cent of homes need major repairs.
“Major repairs needed” refers to significant issues such as defective plumbing, electrical wiring or structural repairs.
Sadly, the report finds that 7.5 per cent of households in Thunder Bay need major repairs, the highest in the province.
Vaughan is at the opposite end of the spectrum with only 2.5 per cent of homes needing big repairs.
While mortgage costs and inflation are impacting people’s ability to manage household expenses, there is also the cost of getting the repairs done.
“The largest contributor to this would be rising home replacement costs due to inflation of building materials,” said Aren Mirzaian, CEO of MyChoice.
And home insurance rates are also increasing — up 8.6 per cent in 2023 partly due to inflation but also likely climate change, according to the report.
There has been “a period of heightened natural disasters in Canada, contributing to an increase in claims and subsequent rise in premiums,” the report notes.
Homeowners are encouraged to mitigate claims risk in general by maintaining their homes to prevent minor issues from evolving into larger, more costly repairs, MyChoice advises.
“The connection between the state of home repairs and insurance costs cannot be overstated,” Mirzaian adds.
“If interest rates stay higher for longer in 2024, we could see a surge in insurance claims, which may contribute to the rising insurance premiums. It’s imperative for homeowners to stay vigilant about their home’s condition and make sure they have the appropriate level of insurance coverage.”
See the full report from MyChoice here.
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