Renovation intentions are also up slightly
TORONTO, Oct. 29 /CNW/ - A new RBC study conducted during the market
turmoil in October finds overall intentions to purchase a home in the next two
years remain steady at 22 per cent and have not changed since January 2008. As
well, renovation intentions are slightly higher than last year - up four
percentage points as 70 per cent of respondents are planning to renovate or
make home improvements in the next two years.
"Despite recent economic events, we've noted that Canadians still believe
a home is a good investment and many are continuing with their home
improvement plans," remarked Catherine Adams, RBC Royal Bank's vice-president,
Home Equity Financing.
According to RBC's 5th Annual Renovation Survey, given the choice, most
Canadian homeowners would opt for hammers and paint brushes, rather than
packing tape and cardboard boxes. Seventy five per cent of Canadian homeowners
say that, if their home needed major renovations, they would rather renovate,
than sell and move.
While the majority of Canadians (55 per cent) would definitely continue
to renovate even if housing prices were to drop, they appear to be a little
more hesitant than they were in 2007 (66 per cent). Many Canadians seem to be
choosing to renovate rather than relocate, noted Adams.
Most Canadians planning renovations will spend less than $50,000 and
indicate they plan to spend $10,801 on average - up about 10 per cent from
$9,850 in 2007.
The RBC survey also showed that 63 per cent of homeowners have renovated
in the past two years and more are establishing a realistic reno budget.
Seven-in-ten had a budget and half (53 per cent) stuck to it. Even those
renovators that did go over budget have pulled back significantly. The average
budget excess was 24 per cent in 2008 compared to 74 per cent overage in 2007
and 88 per cent in 2006.
To finance their reno expenditures, Canadians will be less likely to tap
into cash or savings than they have in the past (47 per cent in 2008,
51 per cent in 2007 and 69 per cent in 2004). Only 28 per cent would consider
using the equity in their home, down from 41 per cent who said they would
consider it in 2007. More men (32 per cent) than women (24 per cent) would
consider borrowing against home equity for their renovation - the lowest cost
of all the borrowing options.
"When people are looking for a mortgage they're usually very cost
sensitive, and they seek advice about the best possible rate and product
combination. We don't always see those same savvy cost comparisons for home
renovations, even though many involve sizable expenses," added Adams.
When it comes to top mistakes or renovation disasters, Canadians who have
completed a renovation in the past two years, blame going over budget (26 per
cent); using the wrong contractor or tradespeople (14 per cent); choosing the
wrong products (12 per cent) and doing it myself (11 per cent).
Renovations by the Numbers
Intentions among Regions Average Spend
BC 69% (down from 70%) $10,064
Alberta 74% (up from 69%) $12,422
Sask/Man 71% (down from 75%) $ 9,742
Ontario 71% (up from 66%) $12,305
Quebec 67% (up from 64%) $ 8,463
Atlantic Canada 73% (up from 67%) $10,042
Renovate or Sell/Move
Region Renovate Sell
------ -------- ----
BC 75% 19%
Alberta 71% 23%
Sask/Man 75% 17%
Ontario 75% 19%
Quebec 74% 17%
Atlantic Canada 78% 15%
- 18 to 34 - 70 per cent would renovate instead of sell (down from
75 per cent)
- 35 to 54 - 78 per cent would renovate, not sell (up from 75 per cent)
- 55 and above - 76 per cent would opt for renovations (up from
58 per cent)
These are some of the findings of two RBC polls conducted by Ipsos Reid.
The online surveys are based on nationally balanced samples and were weighted
according to 2006 Census Data.
The poll conducted between October 9 and 13 included 1,474 Canadians. A
random, representative sample of this size would yield results considered
accurate to within +/-2.6 percentage points, 19 times out of 20, of what they
would have been had the entire adult Canadian population been polled.
The second poll conducted between August 13 and 18, 2008 dealing with
renovation intentions included 3,733 Canadian homeowners. A random,
representative sample of this size, would yield results considered accurate to
within +/-1.6 percentage points, 19 times out of 20, of what they would have
been had the entire adult Canadian population been polled.
For full tabular results, please see the Ipsos Reid website at
Downloadable graphics also available at www.rbc.com/newsroom.
For further information:
For further information: Media Contact: Jackie Braden, Media Relations,