Canada NewsWire
TORONTO, Sept. 3, 2019
TORONTO, Sept. 3, 2019 /CNW/ - According to a new survey released today by BMO, first-time home buyers generally have a positive outlook on the housing market.
The survey, conducted by Pollara Strategic Insights, found:
According to BMO Economics, the housing market is showing signs of firming again and eight out of 11 of Canada's larger cities are currently either buyer's markets or balanced: Vancouver, Victoria, Calgary, Edmonton, Regina, Saskatoon, Winnipeg, and Toronto. As well, the First-Time Home Buyer incentive is expected to provide a moderate lift to sales. Taken together, it is creating an environment of stronger consumer demand for housing.
The Home Stretch
When it comes to being able to afford a home, first-time buyers indicate that they are willing to stretch their wallets:
"While first-time home buyers believe that market conditions are favourable for buyers, it's important to make sure that carrying the costs are sustainable," said Hassan Pirnia, Head, Personal Lending and Home Financing Products, BMO Bank of Montreal. "What we recommend is coming in and speaking with a mortgage specialist to come up with a plan that will put the buyer in a position to comfortably afford a home and help them understand the criteria for qualifying for the new incentive."
The down payment challenge
As more Canadians look at the possibility of home ownership, many suggest that they will struggle on the down payment. With a five per cent down payment as the minimum, over a quarter (26 percent) of first-time home buyers say having enough money to meet this threshold will be a major challenge, while 39 per cent indicate it will be a minor challenge.
The report also pointed out that prospective home buyers range in financial preparedness. Only 14 per cent of new home buyers are already in a position to make a down payment, and over half (55 per cent) say they expect to have the money for a down payment in the next two years. As well, most first-time buyers will be carrying debt into homeownership. Just over one third of new home buyers (38 per cent) say they will be debt free before they purchase their first home.
"Purchasing a home is a major milestone, but it is important to consider how home ownership will impact day-to-day finances and short-term and long-term financial plans," noted Mr. Pirnia. "We encourage new homebuyers to familiarize themselves with the various tools and resources available like BMO's payment and affordability calculators. They will help to provide a full picture of costs and determine financial comfort levels."
Tips for First-time Buyers
For more information on mortgage options and affordability tools or to connect with a BMO mortgage specialist, visit: https://www.bmo.com/main/personal/mortgages/.
The BMO First-Time Home buyers Survey was conducted by Pollara Strategic Insights via an online survey between August 15 and August 19, 2019, with an online sample of 805 adult Canadians. Data has been weighted using the latest census information to be representative in terms of gender and region. The margin of error for a probability sample size of 805 ± 3.5% is 19 times out of 20.
About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $839 billion as of July 31, 2019, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.
SOURCE BMO Financial Group
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