New BMO housing market report shows new buyers are also tapping family for financial help in buying a home
The economic impact of the pandemic has cemented decisions to choose fixed-rate mortgages for Canada’s first-time homebuyers.
According to a new report from BMO, 57% of those planning to buy their first home will lock-in a rate rather than opt for a variable rate, despite the current low interest rates.
These buyers, keen to enter the growing housing market, appear to be looking long term and perhaps expecting the Bank of Canada to hike the base rate once the economy has recovered; 55% believe buying with a fixed-rate mortgage now will save them money over the term of the loan.
The poll, conducted by Pollara, reveals that 56% will be seeking financial assistance from family to buy a home with nearly a quarter looking for between $10,000 and $50,000. On average, these first-time buyers are looking for more than $44,500 in assistance.
Changing needs
A separate survey by TD shows that the pandemic is driving change in the requirements of Canadian homeowners.
With people spending more time at home, including working from home, many intend to make improvements. Almost one quarter of respondents say their homes are not designed for regular home-working.
Just 3% of respondents have bought a new house, vacation home or property since the pandemic hit but more than 1 in 10 expressed an intention to buy in the future as a result of the pandemic.
More than one third said they have completed significant home renovations or repairs to accommodate their new home-centric lifestyle, or they plan to.
The pandemic has also accelerated plans of those in romantic relationships to move in together (28%); make significant household purchases (27%); buy a home together (19%) or get engaged or married (17%).
