Almost half of Canadians who rent will either continue renting indefinitely or aren’t sure when they will buy, citing lack of cash, fear, and uncertainty
WINNIPEG, MB, June 23, 2022 /CNW/ – A recent survey from Canada Life reveals that current market conditions are changing people’s home ownership plans. It’s a trend that could have lasting impacts on retirement planning.
The survey finds that high real estate prices are not only preventing many renters from entering the housing market, but they’re also causing current homeowners to feel house poor. Almost half of the respondents who rent (45 per cent) will either continue renting indefinitely or aren’t sure when they will buy.
“Canadians are at an investments crossroads,” says Paul Orlander, Executive Vice-President, Individual Customer, Canada Life. “While buying a home can help you build equity that could be valuable to one’s long-term financial plans, renting may provide more peace of mind around affordability, flexibility and lower housing costs which could leave more for savings and investments each month.”
Key highlights from the study include:
- Almost three-quarters (73 per cent) say it’s a bad time to buy a house, with renters citing their top three reasons for not getting into the market as high real estate prices, lack of money for a down payment and not having enough income to qualify for a mortgage;
- While 79 per cent agree home ownership is a good investment, 64 per cent say they think new homeowners won’t be able to break into the market unless they have financial support from others, like a family member;
- Canadians aged 25-29 are two times more likely never to purchase a home or continue renting indefinitely compared to those aged 30-49; and
- 24 per cent of homeowners say they feel house poor today.
Disruption to retirement
When it comes to financial support to buy a first home, two-thirds (64 per cent) of Canadians surveyed think that new homeowners will only be able to get into the housing market with help from others.
Of those who have provided financial support towards a down payment, almost half say their savings (43 per cent) or ability to invest (48 per cent) have decreased, and about one-in-three will need to modify their retirement plans (24 per cent) or postpone home renovations (32 per cent).
“Home ownership is one of the most important investments in one’s lifetime and with the right advice and long-term planning, a plan to build home equity should be one that is within reach for first-time homebuyers in Canada,” said Hugh Moncrieff, Executive Vice-President, Advisory Network and Industry Affairs, Canada Life. “Whether renting or buying, an advisor can help you plan for whichever works best for you. They can help you build an effective investment strategy, explain the long-term value of real estate within that strategy, knowing your first home isn’t always your forever home.”
These are the findings of a study conducted by Canada Life from May 5 – 11, 2022, with an online sample of n=1,572 Canadian adults who are members of the Angus Reid Forum. The margin of error for a probability sample size of 1,572 is ± 2.5% 19 times out of 20.
About The Canada Life Assurance Company
Canada Life is a leading insurance, wealth management and benefits provider focused on improving the financial, physical and mental well-being of Canadians. For more than 170 years, individuals, families and business owners across Canada have trusted us to provide sound guidance and deliver on the promises we’ve made.
As of January 1, 2020, Great-West Life, London Life and Canada Life became one company – Canada Life, and today, we proudly serve more than 13 million customer relationships from coast to coast to coast.
SOURCE Canada Life
For further information: Liz Kulyk, AVP, Media & Public Affairs, Canada Life, 204-391-8515, [email protected]