Homeownership in Canada: A Strained Affordability System

Strategic Insights -

A new national survey reveals a growing dependence on external help for Canadians seeking to purchase a home, highlighting the pressure on the country's affordability system. According to the Mortgage Professionals Canada State of the Housing Market survey, 70% of recent homebuyers report requiring assistance with their down payment. This shift in consumer behavior is driven by the growing divide in access to homeownership, with 74% of mortgage holders expecting to renew their mortgages within the next three years, expressing concern about the implications of these renewals.

Key Takeaways:

  • 70% of recent homebuyers in Canada relied on external help for their down payment, emphasizing the crucial role of financial assistance in securing homeownership.
  • Affordability concerns are driving a shift in consumer behavior, with 74% of mortgage holders expecting to renew their mortgages within the next three years and expressing anxiety about the implications of these renewals.
  • Fixed-rate mortgages remain the preferred choice among Canadian borrowers, preferred by 68% of those surveyed, while 16% reported making extra payments on their mortgages, and younger Canadians were more likely to increase their payment frequency.
  • Homeowners who used a mortgage broker reported higher satisfaction with their financial decision, indicating the importance of expert guidance in navigating the complex mortgage landscape.
  • The Canadian mortgage market is witnessing a growing trend of homeowners undertaking renovations to increase their property's value and rental potential, with 70% of homeowners stating they have recently renovated or plan to do so.
  • Concern about mortgage fraud is increasing, with 34% of Canadians rating their concern as high, and 85% advocating for stronger security measures to address this issue.
  • Support for enabling mortgage professionals to verify income directly with the CRA has grown, with 57% of Canadians now in favor, up seven points from 2023.
  • As affordability demands rise, Canadians are turning to mortgage brokers for advice, with 83% of those who have used a broker expressing a desire to return to the same broker for future mortgage needs.

Statistics:

  • 70% of recent homebuyers required assistance with their down payment, highlighting the strain on the affordability system.
  • 74% of mortgage holders expect to renew their mortgages within the next three years, with 16% expressing anxiety about the implications of these renewals.
  • 68% of borrowers prefer fixed-rate mortgages, and nearly 20% reported making extra payments.
  • 70% of homeowners have recently renovated or plan to do so.
  • 34% of Canadians rate their concern about mortgage fraud as high, while 85% advocate for stronger security measures.

Sources:

  • Mortgage Professionals Canada's annual State of the Housing Market survey
  • The Canadian Real Estate Association
  • Statistics Canada