No longer paying rent is top-of-mind when buying a house for Canadians surveyed in a newly released 2018 Prospective Home Buyer Survey by Canada Mortgage and Housing Corp. (CMHC).
The three groups surveyed — first-time buyers, previous owners and current owners — say the main reason for buying a house is to stop paying someone else rent (65 per cent for first-time buyers and 60 per cent for previous owners). The other two top homebuying motivators across all groups were to improve accessibility (physical obstacles and barriers) and to pursue an investment opportunity. Changes to mortgage regulations and possible future interest rate increases were not among the top motivators for participants in the October 2017 online survey of 1,501 first-time buyers, 506 current owners and 500 previous owners.
“The survey findings provide insights and valuable information for mortgage professionals about their future clients and their needs,” says Nathalie Fredette, vice-president, Client Relationship Management. “It brings awareness amongst the industry and contributes to financial literacy by helping Canadians make informed and responsible homebuying decisions.”
Other areas addressed in the survey were housing expectations, financing and saving for a down payment. Some of the results include:
More than 40 per cent of first-time buyers and previous owners say they would delay their home purchase if they were not able to find their ideal home, with a fairly similar proportion saying they would be willing to compromise on the size of the home and location.
An existing move-in-ready home is the top choice for all groups, followed by a newly constructed home, noted by approximately one-fifth of first-time buyers and previous owners.
Among all groups, the two most common actions completed one to two years before buying a home are saving for a down payment and determining what type of home to buy.
About one in four prospective homebuyers stated they would very likely consider delaying their purchase in the event of an increase in interest rates.
The majority of future homebuyers intend to obtain a mortgage to finance their home purchase, with first-time buyers showing higher incidence compared to previous owners and current owners.
Across all groups, more than six in 10 say they are likely to have a financial buffer in case their expenses change in the future.