Canadians' dream of homeownership persists, despite affordability concerns: CIBC Poll

Most parents worry about housing affordability for the next generation, and plan to help their kids make a down payment when the time comes

TORONTO, June 5, 2023 /CNW/ - A new CIBC poll finds that despite concerns about affordability, homeownership continues to be an important goal and a great source of pride for Canadians. The homeownership ambition is so important that 63 per cent of those surveyed with children at home say they plan to help their kids with a down payment someday, with 79 per cent citing fears about future home affordability for their children.

Owning a home remains a top goal for many non-homeowners (71 per cent). Most mortgage holders (82 per cent) and renters (64 per cent) are concerned about how inflation and rising rates will affect their ability to make mortgage payments or keep up with rental costs.

"Many Canadians recognize that homeownership could be out of reach for their children, unless they have help with a down payment," said Carissa Lucreziano, Vice-President, Financial and Investment Advice, CIBC. "Being able to help your children save for a home is a great gift, however you need to be aware of how it can impact your own finances such as effectively managing your cashflow, paying down your own debt or saving for retirement."

Current homeowners are not looking to move anytime soon

Given the current housing market, 66 per cent of homeowners say they are likely to stay in their home longer than expected, with 40 per cent saying they may consider selling their home when economic conditions stabilize. Only 31 per cent of people polled say they are in their "forever home." Among all homeowners, 30 per cent say they are likely to take advantage of the newly available multi-generational home renovation tax credit over the next five years.

Some homeowners expressed regret about the timing of their house purchase with 37 per cent wishing they had bought their home when mortgage rates were lower and 30 per cent wishing they had sold their home during the recent housing market peak.

The poll found that most recent first-time homebuyers are buying previously owned homes vs. purchasing new builds:

• 59 per cent purchased a previously owned home (e.g., semi-detached, detached or townhome)
• 15 per cent purchased a pre-construction home through a builder or contractor
• 15 per cent purchased a previously owned condominium
• 7 per cent purchased a pre-construction condominium through a builder or contractor

Prospective homeowners taking action to save for home ownership

Despite these worries, Canadians continue to save for a new home. The most common actions prospective homeowners are taking to afford their home include reducing spending (37 per cent), setting a monthly budget (33 per cent), putting large expenses on hold (31 per cent), adjusting their home-buying expectations (23 per cent), working overtime, or taking extra jobs (22 per cent). Top sources of funding for a down payment include:

• 55 per cent plan to use funds from a regular savings account
• 28 per cent plan to use funds from their Tax-Free Savings Account (TFSA)
• 22 per cent say they will use the proceeds from the sale of their existing home
• 25 per cent plan to use their Registered Retirement Savings Plan (RRSP) funds through the Home Buyers' plan
• 16 per cent plan to receive a gift from a relative
• 16 per cent plan to receive a loan from a relative

Meanwhile, for those renting many (46 per cent) feel as though they are in a better place to pay their rent than they were a year ago, 64 per cent still worry they will not be able to keep up with future rental costs.

"A trusted advisor will take a holistic view of your finances, help identify your goals and create a realistic plan to help guide you on the path towards achieving your ambitions," added Lucreziano.

Smart Advice with Carissa Lucreziano is a new podcast designed to bring Canadians financial advice, investment strategies, and economic trends from leading industry experts. The podcast is available on all popular podcast players including Apple, Spotify and Google.

This Maru Public Opinion survey conducted on behalf of CIBC was undertaken by the sample and data collection experts at Maru/Blue. Randomly selected Canadian adults who are Maru Voice Canada online panelists were surveyed from March 21 to April13 and categorized in the following groups:

• 863 current homeowners
• 805 non-homeowners who breakdown into
• 684 renters
• 121living with family
• 863 prospective homeowners

Homeowners and non-homeowners are weighted by age, gender and region to match the population, according to Census data. This is to ensure the sample is representative of the adult Canadian population within the target group. For comparison purposes, a probability sample of this size has an estimated margin of error (which measures sampling variability) of +/- 3.3% for current homeowners and +/- 3.5% for non-homeowners, 19 times out of 20. Discrepancies in or between totals when compared to the data tables are due to rounding.

CIBC is a leading North American financial institution with 13 million personal banking, business, public sector and institutional clients. Across Personal and Business Banking, Commercial Banking and Wealth Management, and Capital Markets businesses, CIBC offers a full range of advice, solutions and services through its leading digital banking network and locations across Canada, with offices in the United States and around the world. Ongoing news releases and more information about CIBC can be found at www.cibc.com/ca/media-centre.

SOURCE CIBC