- More respondents plan to buy in the next two years and believe it’s a good investment
- 50% are saving less to buy a home due to inflation
- 57% would need a side hustle or second job to afford a home
- 58% are worried about covering the costs of home ownership (66% among next-time home buyers)
TORONTO, April 23, 2024 /CNW/ – Despite affordability challenges and inflation continuing to impact how and when Canadians buy a home, confidence in making the move to purchase a home is rising. According to RBC’s 30th annual Home Ownership Poll, conducted among Canadians under the age of 65, 60% believe owning a house or condo is a good investment (up from 53% in 2023) and 29% are looking to buy in the next two years (up from 22% in 2023). Two-thirds (64%) say they have always dreamed of owning a home.
At the same time, the research found that half (50%) of Canadians say inflation is eroding their ability to save for a home. This challenge is acutely felt among those planning to purchase a home within the next two years. Among these potential buyers, there has been a 37% decrease in the total amount they have saved to put towards buying a home. Among those who have saved some amount, 36% say they aren’t putting aside money every month for a home purchase (up from 8% in 2023). Even with this setback, 41% of overall potential home buyers say it will take them four years or less to save enough for a down payment.
“Canadians have a lot of headwinds to face as they look to purchase a home today, whether they are a first-time buyer or searching for their next home,” says Janet Boyle, senior vice president, Home Equity Finance & Newcomer Strategy, RBC. “While affordability anxiety remains, our research found that many home buyers are exploring different approaches to realize their dream of home ownership.”
Canadians explore various strategies to cover the cost of home ownership
Despite it being harder to save for a home, potential buyers are searching for additional ways to supplement their savings. The majority (57%) say they would need a side hustle or second job and more than a quarter (27%) have had to or would have to live with their parents longer to afford a home. Almost half (45%) also say they would need to overhaul their spending and saving habits to buy a home.
Family also continues to play a big role, with 62% saying financial support from family is necessary to buy a home and 19% saying they have or will need to buy a home with their family/parents. But support from family might not always be available with 39% of respondents saying they want to give family members money for housing or rent, yet can’t afford to do so. The majority (54%) also say they would prefer to have their child/family live with them to help them save money rather than provide financial support.
Mounting costs and inflation putting pressure on next-time home buyers
Two-thirds (66%) of next-time home buyers (i.e. those who currently own a home and are likely to buy again in the next two years) are concerned about covering the costs of home ownership. Additionally, half (51%) of next-time home buyers say they are worried about their ability to buy their next home due to inflation.
The research also found that three-quarters of next-time home buyers (76%) believe the housing market in their community is overpriced. Two-thirds (64%) say they wouldn’t be able to purchase their first home in today’s market and the same proportion (64%) believe they would need to move out of the city they are currently living in if they wanted to buy a larger home.
Newcomers are eager to buy in the near future
Among newcomers who arrived in Canada in the past five years, 73% say they have always dreamed of owning a home and 65% say they are likely to purchase one in the next two years (compared to 29% nationally). The majority also believe there is only a small window of time to take advantage of lower house prices (56%).
“Whether it’s your first or next home, with so many decisions to make it’s easy to feel overwhelmed when thinking about buying a home,” adds Boyle. “Whether in person or online, getting expert advice and having conversations early can help take a lot of the unknowns and stress out of the home buying process. Having a financial expert on your side who has a full picture of your finances can also help you build a home buying plan that aligns with your finances, goals and lifestyle.”
RBC resources to help home buyers at every step:
- RBC True House Affordability Tool: See how much home you may be able to afford and learn about different mortgage options.
- RBC Home Value Estimator: See what your current home may be worth today.
- My Money Matters: Whether you are looking to buy your first home, second home, or even an investment property, you can find answers to all your mortgage financing and refinancing questions and helpful resources through RBC’s new online resource hub.
- Houseful, an RBC Company: From finding a home to financing one, Canadians can simplify their home buying experience with everything they need in one place. Get access to customized home searches, local real estate agents, affordability tools, RBC mortgage specialists and financing under one roof.
2024 RBC Home Ownership Poll
|
RESPONSE |
CAN |
BC |
AB |
SK / |
ON |
QC |
AC |
NTHB |
Newcomers |
|
% Agree – Base: All Respondents |
|||||||||
|
Always dreamed of owning a |
64 % |
64 % |
54 % |
66 % |
66 % |
64 % |
65 % |
66 % |
73 % |
|
Rising inflation is causing me to |
50 % |
51 % |
51 % |
58 % |
50 % |
51 % |
44 % |
64 % |
68 % |
|
Would need a side hustle or |
57 % |
62 % |
58 % |
62 % |
60 % |
47 % |
53 % |
51 % |
75 % |
|
Have/will need to live with my |
27 % |
32 % |
25 % |
30 % |
31 % |
20 % |
19 % |
30 % |
46 % |
|
Would need to overhaul my |
45 % |
52 % |
43 % |
50 % |
45 % |
38 % |
48 % |
51 % |
49 % |
|
Financial support from family is |
62 % |
67 % |
64 % |
58 % |
68 % |
51 % |
56 % |
64 % |
69 % |
|
Have/will buy a home with my |
19 % |
23 % |
13 % |
20 % |
22 % |
14 % |
13 % |
33 % |
41 % |
|
Prefer to help my family/child |
54 % |
51 % |
53 % |
55 % |
58 % |
51 % |
51 % |
64 % |
61 % |
|
We only have a small window of |
34 % |
36 % |
32 % |
36 % |
39 % |
26 % |
36 % |
50 % |
56 % |
|
Housing market in my |
77 % |
85 % |
65 % |
76 % |
79 % |
73 % |
82 % |
76 % |
72 % |
|
% Selected – Base: All Respondents |
|||||||||
|
Buying a house or condo is a |
60 % |
67 % |
60 % |
59 % |
62 % |
50 % |
59 % |
79 % |
79 % |
|
Likely to buy in the next two |
29 % |
31 % |
31 % |
31 % |
30 % |
27 % |
21 % |
100 % |
65 % |
|
In terms of inflation, concerned |
58 % |
60 % |
61 % |
65 % |
63 % |
43 % |
60 % |
66 % |
76 % |
|
In terms of inflation, concerned |
44 % |
52 % |
40 % |
41 % |
47 % |
36 % |
39 % |
51 % |
71 % |
|
Would give family members |
39 % |
40 % |
40 % |
32 % |
39 % |
42 % |
39 % |
30 % |
40 % |
|
% “Agree” – Base: Homeowners |
|||||||||
|
While I already own a home, I |
69 % |
75 % |
64 % |
63 % |
72 % |
65 % |
76 % |
64 % |
54 % |
|
If I want to own a home/larger |
51 % |
67 % |
44 % |
43 % |
56 % |
43 % |
47 % |
64 % |
57 % |
|
*NTHB – next-time home buyers (i.e. those who currently own a home and are likely to buy again in the next two years) |
About the Survey
An online survey of 2,824 Canadians aged 18 to 64 was completed between January 25 and February 23, 2024, using Leger’s online panel. No margin of error can be associated with a web panel. For comparative purposes, a probability sample of 2,824 respondents would have a margin of error of ±1.8%, 19 times out of 20.
Disclaimer
This news release is intended as general information only and is not to be relied upon as constituting legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. The information presented is believed to be factual and up-to-date but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or any of its affiliates.
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SOURCE RBC Royal Bank
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