More Canadians than ever before believe it isn't a good time to buy a home

With home prices skyrocketing across the country, more Canadians than ever before believe this is not a great time to buy a home.

A report published by the national mortgage industry association Mortgage Professionals Canada (MPC) on Wednesday reveals that only 29% of Canadians think it’s a good time to buy a home. This is the lowest number ever recorded in the country’s history.

The pandemic caused rents to fluctuate and changed home prices, mortgage rates, and interest rates across Canada, leading to population changes in Canadian communities.

Oxford Economics, a world leader in global economic forecasting and quantitative analysis, authored the report using data from a survey of more than 2,000 Canadians.

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“As Canadians have seen higher home prices broadly across Canada, this development has impacted the views on homebuying, with only 29% of respondents in our survey stating it was a good time to buy a home in their community,” said MPC CEO and President Paul Taylor, adding that this was the lowest share ever recorded in MPC’s survey history.

“The overall average sentiment of respondents is demonstrated by the significantly reduced score of 4.2 out of 10, well below the score of 5.5 out of 10 seen over the past three surveys.”

Even though most don’t believe it’s the best time to purchase a home, 7.3 out of 10 of respondents said they believe housing prices will rise “higher than last year’s score of 6.9 out of 10.”

Most Canadians (7.1 out of 10) still believe real estate is a good option for long-term investment, which, MPC reports, is consistent with previous survey results.

Even with rising interest rates, 64% of survey respondents said they negotiated their interest rate at renewal, and 48% said they negotiated a significant improvement to their first offer.

“We’re seeing that 90% of Canadians are happy with their decision to purchase a home” said MPC Chair Joe Pinheiro, adding that 3% regret that decision and 7% wish they had bought a different home.

Even with the interest in long-term investments and passive income, most Canadians buy homes with the motivation to live in them. About 77% considered buying a home with the primary intent to live in it, and 23% saw it as an investment opportunity. The latter rate has been rising in the last two years.

“While investment returns are a secondary consideration, suitability for living remains the driving factor in decision-making,” Pinheiro observed.