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Canadian Housing Industry Insights - Highlights From MPC's 2022 Year-End Survey


Of late, there has been constant chatter about the Canadian housing market with interest rates going up and home prices being high which has been the leading cause of the decline in affordability. Naturally, Canadians have been anxious about inflation and how it would affect their finances as inflation has climbed 20% in the past six months. According to the survey, a record-high number of non-owners believe they will never be able to buy a family home, at 33 percent, growing by 8 points in just six months and a whopping 15 points year-over-year.

However, a big majority (almost 80%) of Canadians feel real estate is a good long-term investment. This outlook has remained the same just as in earlier surveys. MPC's CEO Lauren van den Berg reveals, "What we heard from Canadians is that close to half of first-time home buyers would work with a broker to help them navigate the largest investment of their lives." The volatility of the market does not mean that home buyers should underestimate the services of a broker. “Brokers continue to prove their worth in the Canadian housing market with 9 out of 10 customers reporting they were very satisfied with their experience and 4 out of 5 saying they would recommend their broker to friends and family,” she added.

Highlights from MPC’s 2022 Year-End Consumer Survey & Outlook are as follows -

Kinds of mortgages:

  • Fixed-rate mortgages were held by 69% of mortgage holders in 2022. This was up from 66% in 2021.

  • Fixed-rate mortgages are most popular among the age group of 55 and older (75%) and those residing in the Atlantic region (81%).

  • 25% of mortgages have variable or adjustable rates. This declined slightly from 26% in 2021.

  • 3% of borrowers have hybrid mortgages which are a combination of fixed and variable (down from 4% in 2021)

Refinancing

  • 75% of Canadians have not considered refinancing their mortgage

  • Individuals who are 55 and older (80%) and those from Manitoba and Saskatchewan (81%) are least likely to consider refinancing.

  • 5% have refinanced their mortgage in the past year

  • 8% have refinanced, but not in the past year

  • 10% of those who refinanced have paid a penalty

  • $5,173 is the average penalty paid when refinancing a mortgage (this figure is down from $6,472 a year ago)

Mortgage Renewals

  • Those who expect to renew their mortgage within the next three years form 55% of the mortgage holders

  • Those who expect to renew in the next year comprise 16%

  • Those who expect to renew in the next two years comprise 32%

  • Those who expect to renew in the next three to five years comprise 44%

Source: Mortgage Professionals Canada's latest State of the Housing Market report: 2022 Year-End Consumer Survey and Outlook.

If you have any questions or concerns about housing or mortgages, do write to us at LendX Financial in Brampton, Greater Toronto Area.

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