A growing majority of Canadians believe that now is the time to get into the housing market, even though they don’t expect house prices to rise in the next year, according to the 19th Annual RBC Homeownership Poll.
Of 2,000 Canadians surveyed, 59% said they’d be better off by getting into the market now rather than waiting until next year. A vast majority of those polled – 88% – said they believe housing is a good investment and more than two-thirds believe the value of their home has increased in the past two years.
Three-quarters of Canadians feel they are well-positioned to weather a potential downturn in home prices.
Despite this boost in confidence, however, 73% of Canadians say they’re unlikely to buy a home in the next two years.
“There’s a mix of opinions on the housing market, as Canadians still feel confident about real estate but are a little uncertain about where the market is heading and when it makes sense to buy,” said Marcia Moffat, head of home equity financing, RBC. “Considerations such as affordability and available housing choices may be the difference between intent and reality when purchasing a home.”
The RBC poll found that after four years of sentiment favouring a buyer’s market, the tide appears to be turning. While 38% of Canadians say it’s still a buyer’s market, with the number of houses available exceeding the number of buyers, 27% now believe it’s a seller’s market, with the number of buyers exceeding the number of homes available. That’s up from 20% last year.
Another 36% believe that the housing market is balanced, down from 40% a year ago.
Prices, mortgage rates expected to remain stable
Less than half of Canadians feel housing prices will be higher this time next year, while 30% expect prices to be stable.
On the mortgage side, nearly half of respondents expect rates to stay the same next year, up sharply from 30% in 2011. Only 41% of Canadians anticipate higher rates, down sharply from 60% last year.
“Steady as she goes seems to be the order of the day here, as more Canadians see stable home prices and mortgage rates over the next year,” said Moffat.
Prospective homebuyers who plan to buy in the next two years cited some concern about home prices increasing and mortgage rates rising. Other concerns include their current debt levels, qualifying for a mortgage, and having a sufficient down payment.
Divided by region, the poll shows that Albertans are most likely to say now is the time to get into the housing market rather than waiting until next year. More than half of Albertans surveyed say current housing conditions reflect a buyer’s market.
In contrast, residents in Manitoba and Saskatchewan largely believe it’s currently a seller’s market, and are less likely to get into the market in the near future.
Ontarians, meanwhile, are the most likely in Canada to describe the current housing market as balanced. And their confidence is solid: 90% of Ontario residents say a house or condo is a good investment.