Nova Scotia Homeowners Struggling with Higher Interest Rates
NOVA SCOTIA– Maggie Burgess is an outlier in today’s housing market. She is only 25, yet she and her partner, Pat Bergeron, are homeowners. They bought a modest one-floor house in Milford in August of last year. The market had cooled off enough by then for Burgess and Bergeron to afford their own home. But still, $323,000 is a lot of money.
“We started our house hunt in February of last year,” recalled Burgess. “We both have a full-time job so we thought it would be relatively easy to find something within our range. But it took from February until August to find something doable.”
“We actually offered lower, and they took it. They were asking for $330,000.”
But the Bank of Canada has raised interest rates 10 times since March of 2022, just months before Burgess bought her new home. The latest hike came last week, when interest rates sprung up from 4.75 to 5 per cent.
Burgess and her partner started off paying a mortgage of $1,400 a month. That has climbed to $2,200 in less than a year — and that before Wednesday’s hike.
It has taken a major financial toll on the couple, but it’s also been tough mentally. Their quality of life has gone down as they have less free time in their lives. Despite working full-time in the aerospace and defense industry, Burgess has taken a part-time job as a cashier at a gas station.
Bergeron has accepted longer hours at his job. Both rarely have weekends off anymore.
“It’s exhausting, “states Burgess. “It’s hard to actually spend time with my partner. I also have two dogs that I would love to spend more time with. I think that hurts the most, not being able to be with them every day.”
“I’d like to pat myself on the back because I am pretty strong in that way, I do push myself as much as I can, but there is going to be a breaking point and I do feel it’s coming.”
The interest rate hikes are made worse by the fact that inflation has made everything more expensive. It’s more expensive for Burgess to fill up her gas tank to commute to work; her household grocery budget, like everyone else’s, is getting tighter.
After a year of dealing with these inflationary pressures, Burgess says she’s angry. A lot of that anger is directed at government officials who she feels have done little to make the cost of living more manageable.
“I’m pretty upset with them, to be honest with you. I can never get ahead because of them. I’m 25 years old, I shouldn’t be in this situation. There shouldn’t be historical firsts every week.”
“I would ask them if they understand how it is affecting the people who are actually being [hurt] by the interest rate hikes. I guess they’re not taking us into account with that. because we’re the ones who are suffering. And I know I’m not the only one. But we are one of the many who are.”
It’s not only working-class Nova Scotians who have had to make sacrifices. Dana Kayal, of Mill Cove, is an entrepreneur with Epicure. When she bought her home in 2021, her mortgage payments were $1,700. She now pays an extra $1,000-plus. She doesn’t know the exact number because it’s too stressful to read the notices the bank gives her every time the rate goes up.
“I haven’t even opened the last two notices because they’re just gonna take it anyway. I don’t even want to see the details,” she told Huddle.
Kayal lives in her house by herself so the full burden of her mortgage falls on her shoulders. This means more time focused on business and less time to herself.
“I had to look at other ways to get money,” said Kayal. “I’m one of the luckiest because I have a business rather than a job. I just have to work a lot more. Other people don’t have that luxury.”
One of the ways she has brought in extra income is by turning a part of her home into an Airbnb. This came at a huge cost because she was originally planning to use the same suite so her daughter could move in.
The extra expense also puts Kayal’s retirement plans on hold.
“I have the ability to increase income like most business owners. But I thought I was going to be heading to a lower expensive life and a semi-retirement. That’s not happening.”
Derek Montague is a Huddle reporter in Halifax. Send him your feedback and story ideas: [email protected].
George
July 17, 2023 @ 2:47 pm
A 1/4% rise in interest changes their monthly payments by $800? You’ll have to show the math before I’ll believe it.
Maggie
July 18, 2023 @ 7:12 pm
So, it’s gone up $800 over time. When the papers were signed in August of 2022, it was $1400 per month. After that, rates went up almost monthly. We’re not the only ones this has happened to. It’s gradual, over time. Not a $800 jump over night lol
Blownawaylol
July 19, 2023 @ 12:59 pm
You need proof the interest rates have gone up? How old are you?
Realist
July 20, 2023 @ 1:04 pm
I fail to understand how it’s the government’s fault ? Food and gas prices going up were no secret….interest rates rising were also no secret….getting a variable rate mortgage was your own mistake….buying a house in the first place in this crazy bubble was your 2nd mistake….don’t expect the interest rates to drop anytime soon…I would say the only person to blame here is yourself…an you honestly added to the problem by purchasing the house in first place….what are you going to do when all the people who did the same as you decide to sell there homes an the value of your home drops drastically???? Smh you only did this to yourself…take a look in the mirror that’s where you should start looking for answers!!!
Real
July 24, 2023 @ 1:18 pm
Yeah, it was their fault for buying a house instead of being homeless lol. Historically, variable rates have won and at the time nobody could have predicted it would be this much of a hike in rates. Would you have preferred they live with their parents until they were 40? You’re so mad at someone else’s decision. Yes, they’re angry at the government. Do some deep dives and you probably would be too if you were being effected like many others are.