Printed from ottawasmartshopper.ca web site Thursday, March 12, 2009 - © 2009 The Ottawa Smart Shopper
Homebuyers abound: Study
Smart Shopper Staff
Thursday, March 12, 2009 - 09:00
Ottawa Homes - Despite the state of the economy right now, the majority of Canadians think it's a buyers market and more than a quarter say they intend to purchase a home over the next two years, according to a poll released last week by the Royal Bank of Canada.
When asked about their home buying intentions, 27% of respondents said they intend to do so within the next two years, an increase of four points from 23% last year - the largest single year increase since 2001. Additionally, almost half indicated it makes sense to buy a home now versus waiting until next year.
"The current economic environment does not appear to have dampened Canadians' overall confidence in the housing market," said Karen Leggett, head, Home Equity Financing, RBC Royal Bank. "Canadians continue to have an overwhelming belief in the long-term value of a home and we're seeing this in the buying intentions of many first time homebuyers this year."
The RBC survey found that younger Canadians are most likely to spark an upsurge in home sales. In the under 35 group, 48% said they plan to buy, which is up sharply from 36% last year. Renters also appear to be saying they are tired of paying someone else's mortgage payment, with 38% planning to become homeowners in the next two years.
A large majority of Canadians (83%) remain positive that homeownership is a good investment. While the proportion is down slightly from 85% in 2008 and from the all time high of 90% in 2006, it is 10 points stronger than it was a decade ago when only 72% of Canadians thought so.
Among those who intend to buy, three-in-ten say favourable housing price is a major reason driving their decision. In a marked change from last year, 54% of Canadians believe housing prices will be lower in 2009, up from 31% in 2008. Similarly, the study showed 14% of Canadians believe their home has lost value in the last two years. Of these, most think it will take three-to-five years for their home to recover its value.
"Low mortgage rates and favourable housing prices are influencing home purchase intentions this year and may be the reason why more Canadians are poised to purchase over the next two years," added Leggett.
The primary reason stated by homeowners not planning to purchase a home is that they are content with the home they have. Job loss and employment factors as well as general concerns about the economy also influenced a minority of people's decisions not to buy a home.