Cautious mood, less urgency among Canadian homebuyers, but majority
still consider homeownership a good investment
TORONTO, March 26, 2013 /CNW/ - Four-in-10 Canadians (40 per cent)
planning to enter the housing market over the next two years will be
first-time homebuyers, according to the 20th Annual RBC Home Ownership Poll.
The majority of Canadians are taking a wait-and-see approach to home
purchases, with 15 per cent likely to buy in the next two years, down from 27 per cent last year. The
12-percentage-point drop is the biggest year-over-year fall in overall
buying intention as tracked by this annual poll.
"The more cautious mood this year is not surprising and is consistent
with broader economic and industry forecasts. An unseasonably warm
spring, low rates and anticipation of mortgage rule changes may have
led many Canadians to move forward their home purchases in the first
half of 2012," said Sean Amato-Gauci, senior vice-president, Home
Equity Financing, RBC. "Our findings suggest confidence in the housing
market is still high and young Canadians are the bright spot as they
look to buy their first home and seek the advice to do it right."
A majority of Canadians (84 per cent) believe that a house or
condominium is a good investment. Just over half of Canadians think
that now is the time to get into the housing market (52 per cent),
while fewer Canadians believe house prices will be higher at this time
next year (43 per cent, down from 47 per cent in 2012). More Canadians
in 2013 feel that the current housing market is in balance (40 per cent, up from 36 per cent last year).
What factors are sidelining buyers?
The RBC poll found that three-quarters (75 per cent) of Canadians feel
that recent government changes to mortgage rules will impact or delay
prospective homebuyers from getting into the market, but this may be
more perception than reality. The poll also showed almost six-in-10
recent and prospective homebuyers say that a required minimum 5-per
cent down payment (59 per cent) and a shortened mortgage amortization
period to 25 years from 30 years (56 per cent) had little to no impact.
Nearly half of Canadians (49 per cent) expect mortgage rates will be the
same at this time next year.
Consistent with consumer trends, almost half (46 per cent) of first-time
homebuyers cite affordability as a top reason for not buying (47 per
cent in 2012). Meanwhile saving for a down payment (32 per cent, up
from 18 per cent a year ago) and job security (28 per cent, up from 20
per cent a year ago) have taken on increased importance this year.
Given mixed sentiment in the Canadian housing market, the majority of
Canadian homebuyers seek qualified advice in their home purchases.
Three quarters of Canadian homebuyers (76 per cent) turn to their
banker for mortgage advice and four-in-10 (40 per cent) say a bank is their primary source of
information for advice on financing a home purchase, either by speaking
to them directly or using their websites and calculators.
"With all the ambiguity in the market, Canadian homebuyers, especially
first time homebuyers, are looking for trusted advice. Speaking with an
industry expert, like an RBC mortgage specialist in your area, can
alleviate concerns to help guide your home financing decisions and they
can also provide great rates," added Amato-Gauci.
Highlights from across Canada:
Atlantic Canadians (91 per cent) and residents in Manitoba and
Saskatchewan (89 per cent) are the least likely Canadians to purchase a
house in the next two years, while British Columbians are the only
region where a majority describe the current market as a buyer's market
(where buyers have the advantage because the number of houses available
exceeds the number of buyers).
British Columbia: British Columbians are evenly divided on whether it makes sense to buy a
house now (51 per cent) or wait until next year (49 per cent).
One-in-five British Columbians (20 per cent) say they are likely to
purchase a home within the next two years as residents in this province
were more likely than any other Canadian region to forecast lower
housing prices in the next year (38 per cent, national: 24 per cent).
Alberta: Nearly nine-in-10 Albertans (89 per cent) surveyed say buying a house or
condo is a good investment, higher than the national average (84 per
cent), even as home buying intentions have dropped from a year ago (22
per cent, compared with 31 per cent). Almost half of Albertans (49 per
cent) feel their current housing market is balanced, compared to the
national average of 40 per cent.
Prairies: The majority of residents in Manitoba and Saskatchewan (56 per cent) say
it makes more sense to wait until next year to buy a home, in contrast
to the national average that believes it makes sense to buy a home now
given current housing and economic conditions (52 per cent). Still, 88
per cent say buying a house or condo is a good investment.
Ontario: While a majority of Ontarians (86 per cent) do not expect to buy a home
in the next two years, almost as many (83 per cent) feel that a home or
condo is a good investment. Given current housing prices and economic
conditions, more than half of Ontarians (52 per cent) say it makes more
sense to buy now, while 48 per cent prefer to wait until next year.
Quebec: While a majority of Quebecers (87 per cent) surveyed do not expect to
buy a home in the next two years, they also believe that a home or
condo is a good investment (84 per cent).Given current housing prices,
Quebecers were almost evenly split between saying it makes more sense
to buy a house now (49 per cent) versus waiting until next year (52 per
Atlantic Canada: Given current housing prices and economic conditions, Atlantic Canadians
are the most likely in the country to say it makes sense to buy now (64
per cent), rather than wait until next year (36 per cent). Confidence
in the investment value of a home remains high in Atlantic Canada (81
per cent), just below the overall Canadian sentiment (84 per cent).
About RBC's Home Ownership Advice
Canadians can visit the RBC Advice Centre, an online resource to help Canadians understand all facets of homeownership. Through advice videos, articles, and online calculators, Canadians can
learn about buying their first home, planning their next move, or renovating. With more than 1,400 RBC mortgage specialists across the country,
Canadians have access to free, no-obligation professional advice about
RBC mortgage products and services.
About the 20th Annual RBC Home Ownership Poll
RBC is the largest residential mortgage lender in Canada. As the
country's number one source of financial advice on homeownership, RBC
conducts consumer surveys as one way to provide insight to Canadians
about the marketplace in which they live.
These are some of the findings of an RBC poll conducted by Ipsos Reid
between Jan. 31 and Feb. 8, 2013. The online survey is based on a
randomly selected representative sample of 3,005 adult Canadians. With
a representative sample of this size, the results are considered
accurate to within ±3.0 percentage points, 19 times out of 20, of what
they would have been had the entire adult Canadian population been
polled. The margin of error will be larger within regions and for other
sub-groupings of the survey population. These data were statistically
weighted to ensure the sample's regional and age/sex composition
reflects that of the actual Canadian population according to the 2011
For further information:
Matt Gierasimczuk, Corporate Communications, 416-974-2124
Ka Yan Ng, Corporate Communications, 416-974-1794