Canadians are increasingly putting their plans to buy a home on hold over economic uncertainty, a poll from Scotiabank finds.
“It’s no surprise that a perfect storm made up of the rising cost of living, housing supply shortages, and increased demand has caused Canadians to feel like homeownership is out of reach,” John Webster, head of Real Estate and Secured Lending at Scotiabank, said in a press release on April 4.
Conducted between Feb. 15 and Feb. 17 with 3,027 adults, the online housing poll shows that 43 percent of Canadians are putting their plans on hold, compared to 33 percent in 2021, and 20 percent in 2020.
And that is twice as many Canadians when compared to the first year of the COVID-19 pandemic, and the height of uncertainty in 2020, the bank said.
The expectation held by millennials toward the housing market conditions seems to be grimmer.
“Concerns over costs of living, rising interest rates, market instability, and economic uncertainty has most millennials feeling discouraged about their homeownership aspirations,” the bank said.
The survey noted that 90 percent of Canadians between the ages of 18 and 34 believe that housing prices will continue to rise over the next 12 months.
More than half (56 percent) said the current economic environment has “negatively impacted” their finances, leaving them no choice but to put their home-buying plans “on ice.” More than 60 percent said they were waiting for the price to drop before buying one.
On March 15, the Canadian Real Estate Association said the national average home price in February hit a record of $816,720—a more than 20 percent hike from the same month last year.
Statistics Canada reported on March 16 that the consumer price index, a key inflation gauge that measures changes in how much Canadians are paying for goods and services, jumped again in February, rising 5.7 percent compared to February 2021—the largest gain since 1991.
The Scotiabank poll found that a growing number of Canadians are considering moving to the suburbs, with 35 percent of them indicating their interest in 2022 versus 29 percent in 2021.
“This is most common amongst younger Canadians, of which half (49 percent) are considering moving out of their city to get more ‘house’ for their money,” the bank said, while noting that more Ontario residents (39 percent) are thinking of doing so too, when compared to residents of other provinces.
The survey shows homeowners have become less keen on purchasing a new home over the last two years, with 15 percent in 2022 versus 17 percent in 2021 and 18 percent in 2020.
Most homeowners (59 percent) are now planning to update or renovate their current homes within the next two years.
“With the market showing no sign of slowing down, more homeowners are choosing to stay put and invest in their existing property,” the bank said.
The poll was conducted by Maru Public Opinion on behalf of Scotiabank. It is considered accurate within +/- 1.8 percentage points, 19 times out of 20.