Canadians waiting to buy homes until mortgage rates drop: survey

More and more Canadians are holding off on buying a home, with some reporting they aren’t sure if they want to buy anymore, according to a new survey.

According to the Bank of Montreal’s (CMO) Real Financial Progress Index, nearly 70 per cent of Canadians surveyed reported that they are waiting for mortgage rates to drop before buying.

“Among the quarter (26 per cent) of Canadians that have said current mortgage rates have affected their decision to move homes, 18 per cent are holding off because of market uncertainty and volatility,” a news release said.

It’s also stated that the majority of younger people feel that buying a home is more out of reach compared to their parents.

“Gen Z (ages 18 to 24) (71 per cent) are the most likely to have this outlook, followed by younger Millennials (ages 25 to 34) at 69 per cent and older Millennials (ages 35 to 44) at 65 per cent,” it added.

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Unsurprisingly, about half of the respondents reported that the shape of the economy has impacted their decision and 18 per cent say they plan to wait until next year, or later, before buying.

While 20 per cent of respondents say “they are no longer sure if or when they will buy a home.”

The survey cites concerns including inflation, rising interest rates, and the possibility of a recession.

“Homeownership continues to symbolize real financial progress, success, and security for many Canadians and their families,” Gayle Ramsay, head of everyday banking, segment and customer growth, explained.

“While the challenging market and economic conditions may pose hurdles and uncertainty, we encourage Canadians to work with a professional advisor or planner to explore the many paths to homeownership and develop a personalized financial plan to help them get into the home they want within a realistic timeline.”

As for how Canadians plan to get to front the money to buy their own place, the survey says just over half of respondents say they are planning on using savings, while more than 40 per cent reported they plan on taking out a loan or line of credit.

Others say they may be relying on funds from loved ones.