Confidence in the economy and employment has boosted the number of Canadians wanting to buy homes, despite the new stress test guidelines for uninsured mortgages.
In fact, one-third (32%) of polled Canadians say they are very or somewhat likely to buy a home in the next two years, finds an annual RBC home ownership poll. That figure represents an increase of seven percentage points from last year.
Younger Canadians (ages 18-34) express the strongest intentions to hit the open house circuit, with 50% saying they want to purchase a home.
Further, a greater number of younger Canadians this year (84%) think that buying a home is a good investment compared with 79% in 2017. They’re also less anxious about employment and less uncertain about the economy this year compared to 2017.
The poll finds that only four-in-10 (39%) Canadians are aware of the stress test guidelines. Of these, more than half (55%) indicate that the guidelines are impacting their purchase decisions in various ways, including making higher down payments, delaying home purchases, buying smaller homes or buying less expensive homes in different locations.
“Canadians continue to feel optimistic about getting into the housing market despite changes in government regulations,” says Nicole Wells, vice-president of home equity financing at RBC, in a release. “They’re taking a more informed journey to home ownership by starting with affordability.”
As intention to buy continues to climb in Canada, more than one-third (35%) of Canadians say they’ve received or would be receiving financial help from their families for a down payment. An almost equal number (36%) say they’ll save for a down payment on their own with a dedicated savings account.
The two biggest challenges for homebuyers are choosing the right property (32%) and deciding how much they can afford (21%).
Another issue of concern is interest rates. More than half (61%) of Canadians are very or somewhat concerned about interest rate increases, an increase of 10% from last year. In fact, 35% are thinking about buying a home sooner because of current low rates, while 32% are thinking about doing so because of a potential rise in rates.
About the RBC poll: The poll was conducted by Ipsos from Jan. 9 to Jan. 24, 2018, through a national survey of 2,000 Canadians ages 18 and older who completed online surveys. Quota sampling and weighting are used to balance demographics to ensure that the sample’s composition reflects that of the adult population according to Census data.