NW Week

Thursday, February 22, 2024

A growing number of Canadians are deferring home purchases

More Canadians are deferring their home purchases.

Key Takeaways:

  • According to a new Scotiabank study, many Canadians are delaying home purchases owing to record-high prices.
  • The cost of living does not appear to be decreasing any time soon. According to the Canadian Real Estate Association’s most recent data.

According to a new Scotiabank study, many Canadians are delaying home purchases due to record-high costs.

“It’s no surprise that a perfect storm of growing living costs, housing supply shortages, and greater demand has made Canadians feel like homeownership is out of reach,” said John Webster, Scotiabank’s head of real estate and secured lending.

The 2022 Scotiabank Housing Poll, released on Monday, found that 43% of Canadians had put their ambitions to buy a home on hold, compared to 33% in 2021 and 20% in 2020.

“When compared to the first year of the pandemic and the height of uncertainty in 2020, twice as many Canadians are deferring their intentions to buy a home in today’s economic scenario,” Scotiabank stated.

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Younger Canadians appear to be even more dissatisfied with the property market. According to the survey, 56% of respondents aged 18 to 34 said the present economic climate had pushed them to put off buying a property, while 62% said they are waiting for prices to drop before buying.

Costs do not seem to be falling any time soon. According to the most recent data from the Canadian Real Estate Association, the average home price in Canada has increased by more than 20% since last year, reaching a new high of $816,720 in February 2022. 

In the same month, Canada’s inflation rate hit a 30-year high of 5.7 percent. Royal LePage, a real estate business, predicts that by the end of 2022, average home prices will have risen by 10.5 percent to $859,700.

“Most millennials are discouraged about their housing goals due to concerns about growing living costs, rising interest rates, market instability, and economic uncertainty,” Scotiabank stated.

More Canadians are deferring their home purchases.
More Canadians are deferring their home purchases. Image from The Star

In addition, the poll revealed that a rising number of Canadians are willing to relocate further away from major cities to obtain better value for their money, with 35% of respondents in 2022 indicating that they are contemplating it, compared to 29% in 2021. These figures jump to 49% for younger Canadians and 39% for residents of Ontario.

Among those who want to stay put, 59 percent of survey respondents indicated they would choose to repair their current home than purchase a new one, up from 56 percent in 2020.

Between February 15 and 17, 2022, Maru Public Opinion conducted a poll on behalf of Scotiabank. It includes 3,027 Canadian individuals whose responses were weighted to reflect current census data by education, age, gender, and area. The margin of mistake for the results is assessed to be 1.8 percent 19 times out of 20.

Source: CTV News

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