Distribution of homebuyers by total debt service ratio (share of home purchases)

According to a recent report by the Bank of Canada, investors tend to have a higher total debt service ratio than non-investors. This means that Investors that are highly indebted could face difficulty servicing their debt following a loss of income (either employment or rental) or an increase in interest rates.

The total debt service ratio is used to determine if the person has available finances to pay their current debt obligations. The analysis by the Bank of Canada notes that it is unclear what sources investors include in their documented income.
Chart: Deena Zaidi/CTVNews.ca Source: Bank of Canada