Halifax Families Facing Increased Costs As Interest Rates Rise

HALIFAX — Wednesday was a day of financial headaches for homeowners across Canada. For the seventh time this calendar year, the Bank of Canada raised interest rates, increasing from 3.75 percent to 4.25. Back in January, it was a minuscule 0.25.

For those who have variable-rate mortgages, this has added hundreds of dollars to their monthly budget at a time when every other household expense like food, fuel, electricity, and insurance has skyrocketed.

Many in Halifax are concerned the end is yet in sight.

Anthony Winston III Moved to Halifax in June with his wife Erin and two young daughters. He was living in California and operating his own engineering firm, Winston Engineering Inc. But following the brutal death of George Floyd in 2020 at the hands of police, the Winston family decided they had enough of the United States.

“We decided to move from the U.S. right after George Floyd was killed,” recalled Anthony. “I just looked at my wife and said,’ ‘we need to move. Let’s figure out where we want to go.’ We looked at various countries like New Zealand and Mexico and then we decided on Canada.”

“We started trying to figure out where in Canada and just fell in love with Nova Scotia, especially because of the rich history in terms of American slaves coming here. And then we got to visit and see all the natural beauty.”

The family drove from California to Maine before hopping on the ferry. From there Winston started the Canadian branch of his engineering firm. Anthony and Erin also took out a mortgage for their new Halifax home in May. The bank offered them an interest rate of 1.7 percent, with monthly payments of $2,343.39. Seven months later it has ballooned to $3,256.73, not including Wednesday’s increase.

The Winston family, like all other families across Canada, has also had to increase their budget over the last several months for other expenses. A big one for the family is food. Anthony and Erin’s daughters have allergies to things like gluten, eggs, dairy, nuts, and shellfish.

“We buy special breads; it’s almost doubled to 10 bucks a loaf,” said Anthony. “We try to make a lot of things from scratch, which saves us a lot. We’re able to make our own flour.”

The family has also been able to save on fuel costs. Before moving to Halifax, they bought a hybrid vehicle. They are also saving money on the two properties they own in the states because they got a fixed mortgage rate for 30 years.

Anthony says the family can absorb the financial shock for now but is still concerned that inflation and interest rates will keep going up. He is especially concerned for families who will have to choose between paying their mortgage or paying their monthly grocery bill.

“They keep raising these rates. Who knows what’s going happen?” Asked Anthony. “It’s very confusing; I know that raising interest rates is to curb inflation, but there must be a tipping point. You’re going to have families who are paying more for a mortgage, paying more for goods, and that’s got to give; usually, it’s your mortgage right because you got to eat.”

“I hope that their government and the powers that be do something to ease the burden on a lot of families. We’ve been lucky financially but I feel for a lot of our families out there.”

When asked if the higher costs of living, and the higher mortgages, made him want to get back to the States, Anthony was quick to rebuff such a notion.

“We love it out here. We can just let our daughters out to play. We were so used to being in the States and having to be outside with them physically outside watching them. Here, they can just kind of go and be free with the other kids in the neighborhood.”

“We’re happy to pay the premium, especially with taxes, to be here in Canada.”

Derek Montague is a Huddle reporter in Halifax. Send him your feedback and story ideas: [email protected].