TORONTO, Sept. 17, 2020 /CNW/ - A recent Scotiabank survey
revealed that only 38% of Canadians believe now is a good time to
buy a new home. However, younger Canadians appear to be more
optimistic about purchasing a property during the COVID-19
pandemic. Nearly 1 in 5 (18%) Canadians between the ages of 18-34
say the pandemic has accelerated their plans to purchase a home or
investment property; however, one-third of them say they are
waiting for prices to drop before buying a home.
According to findings from the 2020 Scotiabank Housing Poll:
- Lower interest rates are a motivating factor impacting
Canadians' existing plans to buy a property.
- More than 70% of Canadians who are renting say they have no
plans of purchasing a new home in the next 1-2 years, despite low
interest rates.
- 1 in 4 Canadians (25%) believe housing prices will come down in
the next 12 months as a result of the COVID-19 pandemic.
- Canadians aged 18-34 (36%) are considerably more optimistic
that there will be a drop in housing prices, compared to 24% of
Canadians aged 35-54, and 17% of Canadians aged 55+.
And while not all Canadians are looking to purchase a new
property, many are spending more time at home than ever. About 1 in
4 Canadians (26%) are now seriously considering a renovation to
their current home.
"The pandemic has caused many Canadians to turn their living
rooms into classrooms, their dining rooms into offices, and their
basements into home gyms. This is motivating many to consider
investing more in their current homes or re-evaluating their living
spaces altogether," said John
Webster, Head of Real Estate Secured Lending & Scotia
Mortgage Authority at Scotiabank. "Whether you're looking to buy or
embark on a home renovation, it's a great time to take advantage of
the low interest rate environment and get a better understanding of
your borrowing power through solutions like our Scotia Total
Equity® Plan (STEP). Seeking advice from an advisor can help
uncover ways to make those dreams of homeownership or upgrades a
reality, especially younger Canadians who are keen to invest in the
housing market."
Financing considerations during the pandemic
The survey revealed that for Canadian homeowners who are
interested in buying a new property, 68% plan on using their
savings and 42% said the equity from their primary home.
For Canadians who are planning home renovations, half do not
know yet how they plan to finance the upgrades to their
home. Only 12% of homeowners are planning to use equity from
their home to help finance a renovation.
Scotiabank 2020 Housing Poll Highlights:
Young, Patient, and Optimistic:
- Nearly 1 in 5 Canadians between the ages of 18-34 say the
pandemic has accelerated their plans to either purchase a home or
investment property in order to take advantage of the lower
interest rates/home prices.
- 32% of Canadians 18-34 say they are waiting to buy a property
until the house prices come down.
- 36% of younger Canadians aged 18-34 feel that housing prices
will come down as a result of the pandemic, versus 24% of Canadians
aged 35-54, and 17% of Canadians aged 55+.
Investing in Nesting:
- Half of Canadian homeowners planning a renovation (51%) do not
know yet how they plan to finance the upgrades to their home.
- Only 12% of homeowners are planning to use equity from their
home to help finance a renovation, while 20% plan to use a personal
line of credit, 22% plan to take money out of their investments and
3% plan to borrow from family or friends.
Staying Put:
- The COVID-19 pandemic has negatively impacted the finances of 1
in 5 Canadians (20%), forcing them to put their plans to purchase a
home on hold.
- 77% of Canadians who are renting say they have no plans of
purchasing a new home in the next 1-2 years despite low interest
rates.
Methodology:
The 2020 Scotiabank Housing Poll was conducted by Maru Blue on August 24,
2020. A total of 1,509 completed surveys were collected from
a random sample of panel members across Canada.
About Scotiabank:
Scotiabank is a leading bank in the Americas. Guided by our
purpose: "for every future", we help our customers, their
families and their communities achieve success through a broad
range of advice, products and services, including personal and
commercial banking, wealth management and private banking,
corporate and investment banking, and capital markets. With a team
of over 90,000 employees and assets of approximately
$1.2 trillion (as at July
31, 2020), Scotiabank trades on the Toronto Stock
Exchange (TSX: BNS) and New York Stock Exchange (NYSE: BNS).
For more information, please visit our website and follow
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SOURCE Scotiabank