Posted by Oliver Po
Century 21 In Town Realty in Downtown Vancouver
421 Pacific St
Majority of Canadians think they should put money down on new house
Vito Pilieci, The Ottawa Citizen
Despite current market pressures, almost three-quarters of Canadians believe now is the time to buy a new home, according to a national financial study.
The study, released earlier this week by the Royal Bank of Canada (RBC), says 73 per cent of Canadians believe now is the time to buy a home, as depressed housing values have opened up new opportunities.
Despite the current economic crisis, 27 per cent of Canadians are actively seeking to buy a new home, a four-per-cent increase over 2008, according to the RBC study.
"The current economic environment does not appear to have dampened Canadians' overall confidence in the housing market," says 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 positive outlook comes at the expense of construction firms, many of which have introduced thousands of dollars worth of incentives to spur potential buyers, and homesellers who have watched as the value of their homes has slid in recent months.
The average price of a house in Ottawa is expected to hold steady throughout 2009, while home prices in Toronto and Calgary are expected to drop 4.2 per cent and six per cent respectively.
New home sales in Ottawa dropped 75 per cent in Ottawa during the month of January. Toronto sales dropped 69 per cent and a similar trend has occurred in markets all across Canada. Canada Mortgage and Housing Corp. has predicted 2009 will see a nine-year low in new home construction.
Similar trends have occurred in the resale housing market. Sales of resale homes in Ottawa fell 18.7 per cent in January.
More than 54 per cent of survey respondents believe buyers must put a rush on their purchasing decision as waiting until next year would likely see a rebound in the market and higher home prices. More than 30 per cent of Ontarians polled said they will be buying a home within the next two years.
A total of 2,026 Canadians were randomly selected to take part in the RBC study. The study, conducted for RBC by Ipsos Reid between Jan. 6-9, is considered accurate to within plus or minus 2.2 percentage points 19 times out of 20.