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Insights into Canada's Mortgage Holders' minds: Key Takeaways from MPC report



The final of the 'Rapidly Evolving Expectations in the Housing Market' consumer report series has just been released by Mortgage Professionals Canada. These reports help in understanding the market sentiment or what Canadians are expecting from the housing market. The report is based on data collected from a consumer survey. For this edition, the consumer survey included 1,000 Canadians, of whom, 764 were homeowners with mortgages, 192 of them were staying on rented properties, and 44 were counted among others (mostly comprised of people living with parents).


Homebuying expectations are bullish


The data gathered by the survey indicates more and more percentage of Canadians want to and expect to buy a home in the year to come and also, in the following two years. Percentage of non-owners who want to buy a home rose sharply compared to the pre-Covid figures (7%). In the first round of the survey the stats were 14%, second round stood at 16%, third round at 19%, fourth at 23%, and finally 27% in the fifth and final round.


What is even more surprising is that even pre-existing home owners want to buy a home. One-tenth of current home owners are expecting to buy a home in the coming year. Covid has prompted non-owners to look at buying homes in safe, low-density environments i.e. move out of current apartment buildings, condominiums etc. Those looking to buy a new home in the next three years were asked to choose from seven options to answer the question, “Which of the following is the main reason you are considering buying?” and a large number of people selected “my current home is no longer suitable (i.e. size, location).” The re-organizing of the current housing situation may continue for a while. Since mortgage rates and interest rates have been at a record low, home ownership is suddenly affordable than earlier. It is however to be noted that not all of those expecting to buy a home may realize their dream. Once they are out shopping for mortgage they may not be able to pass the stress test to obtain the finances. Some other uncertainties such as employment may hamper their prospects of buying a home too.


Other expectations and thoughts of people from the mortgage market:


• Homeowners do not increasingly worry about their ability to weather a housing market slowdown.

• Real estate is still considered a good long-term investment.

• People feel mortgages are “good debt.”

• People are not too confident about the economic outlook. In fact, their confidence is lower than what it was towards the end of 2019.

• People exhibit a moderate degree of anxiety about Covid’s impact on family finances

• They feel positive about the expectations of growth in house prices because of the acceleration in actual growth.

• They feel the rates are bound to rise.

• Only a few people regret becoming homeowners, something which Covid could not change.


If you have any doubts regarding home buying, market expectations vs reality or any other mortgage relate queries we will be happy to help.


To read the full report click here.

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