Home prices are sliding and the interest rate has been cut again. Two in three Canadians (sixty-five per cent) say all signs are pointing to a buyer's market, according to a new RBC survey.
And, apparently, people are ready to take advantage of it. More than a quarter of respondents, 27 per cent, said they intend to buy a home over the next two years. That's actually up from 23 per cent in 2008. Out of these prospective buyers, three in 10 say their decision was driven by the drop in prices.
In Ontario, the rate is even higher, with 73 per cent saying it's currently a buyer's market and 30 per cent planning to buy, up from 21 per cent in 2008. Thirty-two per cent of those planning to buy said they were influenced by lower home prices.
Almost half of Canadians (48 per cent) and more than half of Ontarians (54 per cent) said it makes sense to buy a home now versus waiting until next year.
The upsurge is driven by the under-35 set, as 48 per cent of the respondents in that age group said they plan to buy, up from 36 per cent in '08.
And, people believe prices will continue to drop. Fifty-four per cent of Canadians believe housing prices will be lower in 2009, up from 31 per cent in 2008. Fourteen per cent of Canadians believe their home has lost value in the last two years.
And, despite plunging prices, 83 per cent of Canadians, and 84 per cent of Ontarians, still see home ownership as a good investment, down slightly from 85 per cent in 2008.
"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, in a release.
"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."
Other nifty facts from Ontario:
- 76 per cent of those planning to buy in plan to purchase resale
- 69 per cent will opt for a detached house
- 96 per cent said low energy consumption was important to them
- 91 per cent were interested in standardized energy ratings for their homes
The survey, conducted by Ipsos Reid between Jan. 6 and 9, polled 2,026 Canadians.
by Jennifer Wilson-Speedy- Toronto Star