Both uncertainty and optimism driving Canadians' home buying decisions: RBC Poll

Elina Fairytale

“There has been a big shift in Canadians’ sentiment around the housing market, including an increase in uncertainty around where the market is today,” said Nick Palucci, senior director, Home Equity Financing, RBC. “But spring is typically a busy home buying season and many potential home buyers may be seeing a window of opportunity opening for them.

“We’re seeing many Canadians taking extra time to plan, save and ensure they’re getting into the market when it’s right for them. At the same time, there has been a wave of optimism among buyers who are looking to get into the housing market for the first time.”

Key findings from the poll include:

• 40 per cent of respondents say they expect to pay less now for a home than they would have a year ago. Respondents are also feeling the seller’s market has passed its peak with only 37 per cent saying it’s a seller’s market, compared to 71 per cent in 2022. For others, there is uncertainty. A quarter of respondents (25 per cent) say they are unsure about the type of market we are in and 18 per cent say they don’t know whether now is a great time to buy;
• 75 per cent are worried about the potential of an upcoming recession, which could be one of the reasons why more than a quarter (26 per cent) are thinking about buying a home later due to the possibility of a recession.  31 per cent believe there is only a small window of time to take advantage of lower house prices and 42 per cent say there will be no peak to how high house prices will go once they start rising again;
• 73 per cent of pre-first time home buyers* say buying a house or condo is a good investment and 41 per cent believe the housing market is strong. This compares to only 53 per cent (down from 69 per cent in 2022) and 30 per cent (down from 46 per cent in 2022) of all respondents respectively;
• The majority of pre-first time home buyers are also optimistic about what might be next: 78 per cent say they will be in a better position to buy a home compared to previous years (25 per cent for all respondents); 68 per cent say lower home prices will finally allow them to buy a home despite higher interest rates (19 per cent for all respondents; 65 per cent are optimistic about the housing market over the next year (31 per cent for all respondents); 51 per cent believe homes will be more affordable in the near future (24 per cent for all respondents);
• 53 per cent of respondents are worried their financial position may deteriorate over the next year. This could be contributing to why only 22 per cent would give an immediate family member or their child money for a new home (down from 26 per cent in 2022).  47 per centsaid they would prefer to help family or children save money by letting them live with them rather than helping them financially. But for those willing to provide financial support, they say they would give more than ever ($68,000 compared to $57,918 last year)..