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Consumer Sentiment in the Residential Housing Market



Mortgage Professionals Canada's annual report on the State of the Residential Housing Market in Canada is out and it gives some in-depth insights into the consumer sentiment during these tough times, the era of the pandemic.


Consumers who were respondents to the survey are offered statements and requested to say if they agree or disagree with the given statement on a scale of 1-10. They are in 'moderately strong' agreement that “low interest rates have meant that a lot of Canadians became homeowners over the past few years who probably should not be homeowners. The average score for 2020 was recorded at 6.68, which is the lowest score on this question till now.


The survey also revealed that the consumers seem to be satisfied with respect to the mortgage choices made by them. This is indicated by the low levels of regret of mortgage holders with respect to their mortgage choices with the average score for this year being 3.62. Since housing prices have gone up at a fast pace as has the growth in average mortgage amount, one might assume that recent buyers would show increased regrets too. But statistics reveal otherwise. The buyers during the years between 2018 and 2021 had a score of 3.60 which is almost equal to the overall average which is 3.62. This translates to only a fraction of a minority i.e. 4% showed high levels of regret about their mortgages while 42% showed very low levels of regret.


It is also to be noted that across provinces the levels of regret about mortgages exhibit only minor variations. The highest levels of regret were found in Saskatchewan with an average of 3.92 followed by Alberta at 3.91. People in Quebec had lowest levels of regret with an average of 3.27 followed by those in the Atlantic provinces at 3.44.


When asked about their ability to withstand a downward curve in the home prices, Canadians indicated they were confident to face such a situation with an average rating of 6.93 which is higher than the long-term average of 6.87. Residents of Quebec were most confident with a score of 7.25 while Sasakatchewan was at 7.11. Residents of Alberta were least confident at 6.27. Overall 72% Canadians were optimistic while 13% gave negative ratings.


Since the year saw my turbulations due to the pandemic, a topical question was added to the survey which read “As a result of COVID-19, I am anxious about my/my family’s financial situation over the next few months.” People showed a moderate level of concern with a score of 5.14 which is just a hint below the neutral level of 5.5. People of Alberta showed the highest levels of anxiety at 5.92, while those in Ontario recorded an average of 5.34. Overall only 13% of Canadians were highly anxious about the financial effects of Covid-19 and 23% of people showed very low levels of anxiety.


If you wish to read more on the subject you can read the complete report by released by Mortgage Professionals Canada here.  

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