Canadian consumer debt pushed higher in the most recent quarter amid a strong recovery in the housing market and a slower payoff of existing mortgages, according to a new report from Equifax Canada.

Total consumer debt climbed to $1.991 trillion in the second quarter, which is up 2.8 per cent compared to the same quarter a year ago, according to the report published Thursday.

Mortgage balances weighed on Canadians’ credit the most with increased refinancing activity and higher average home prices pushing the average debt per person to $73,532, which is 2.2 per cent higher compared to the second quarter of last year.

Meanwhile, non-mortgage debt dropped relative to 2019 as economic shutdowns across the country impacted Canadians’ credit card usage.

“Mortgage activity has withstood the headwinds from COVID and showed the earliest signs of recovery,” Rebecca Oakes, AVP of advanced analytics at Equifax Canada, said in a release.

“Other credit products began to show greenshoots of a bounceback with credit card spending starting to rise in June. Card spending for those not using a payment deferral on their credit card was effectively back to pre-COVID levels by the end of the quarter.”

Many Canadians have resorted to credit payment deferrals to help ease the financial stress amid the COVID-19 pandemic. This has been most popular among Canadians aged 35-44, according to Equifax, where 15.1 per cent have used some kind of deferral compared to 5.7 per cent of seniors.

And while the 90+ day delinquency rate for non-mortgage debt sits at 1.24 per cent, up 10.6 per cent compared with the second quarter of 2019, Equifax said this is a continued trend from last year and doesn’t measure the true impact of the pandemic. 

“Delinquency rates held up relatively well and do not reflect the sharp rise in job losses thanks to the various support mechanisms,” Oakes said.

“One in five people utilizing deferred payments were already financially stressed prior to the start of the pandemic. Some of these consumers may find it harder to recover as support mechanisms start to reduce.”