The mounting affordability crisis is giving many would-be home owners some pause, RBC says
Nearly a quarter (23%) of Canadians said that they are likely to purchase a home within the next two years – down by 7% annually to reach approximately the same level as the rate of home-buying intentions in January 2020, according to a new poll by Royal Bank of Canada.
Respondents cited the erosion of affordability despite federal financial support programs as a major factor in the trend. Around 54% also said that they are feeling stress from the fact that they might have to buy at a location farther from family and friends, while 59% said that location is a more important consideration than a property’s size.
Another 60% said that they have some anxieties about further mortgage rate increases this year, despite 47% believing that they are well-placed to bear the brunt of higher borrowing rates. Two in five respondents reported being “financially overwhelmed” by the prospect of a home purchase.
“While there is still a significant amount of activity in the market, our research indicates that the rush of Canadians looking to purchase a home over the last two years has subsided and we’re now starting to see a move back to pre-pandemic levels,” said Andrea Metrick, senior director of home equity financing, acquisition, and distribution at RBC.
“Between rising costs and the competitiveness of the market, Canadians may now be taking a step back and setting aside more time to plan and save before making the jump into homeownership.”