A majority of Canadians are willing to make at least one sacrifice in their lives in order to afford a home amid high prices and rising interest rates, a new report suggests, with most saying they would relocate to a more affordable area.
Remax Canada’s 2022 Housing Affordability Report released Wednesday found Canadians are also willing to consider different types of homes if they are more affordable, as well as co-owning with friends or family and renting part of their home for additional income.
“Despite all the challenges the markets are facing, Canadians still want to own real estate,” Remax Canada president Christopher Alexander told Global News.
“The fact that they’re willing to make sacrifices to get there, I think that’s really encouraging.”
Remax found Brandon, Man., is currently the most affordable market in the country with an average sale price of $310,252 this year. Regina, St. Johns, Moncton and Red Deer, Alta., round out the top five.
The Greater Vancouver and Toronto areas remain the most expensive markets in Canada, with sales averaging $1.313 million and $1.257 million, respectively. The report does not include data from Quebec.
The report includes a survey conducted by Leger, who spoke to more than 1,500 Canadians online in late June. The sample, pulled from Leger’s online panel of 400,000 people across the country, yields a margin of error of +/- 2.5 per cent.
The results found that while 64 per cent of respondents would be willing to relocate to find a more affordable home, 50 per cent would not travel more than 100 kilometres from where they currently live. Nearly 40 per cent said they would move to different city, province or region regardless of the distance.
Alexander says despite half of survey respondents saying they wouldn’t travel too far to find a home they can afford — making it unlikely many Canadians will make the journey to Brandon or Red Deer — the number of people willing to relocate overall is notable.
“What we saw through the pandemic is people were moving all over the country, and that’s still happening in a big way,” he said.
“In a current home, you really build a community. … So it’s difficult to make such a big adjustment (to relocate). But the fact that 64 per cent are willing to do so tells us that owning real estate is still top of mind for many people.”
Yet the report also found Canadians are hedging their bets on buying a new home amid rising interest rates, which are meant to cool record-high inflation but have also increased mortgage rates.
The survey found 68 per cent of respondents admit they won’t be able to afford to buy a home in the area they want to live in over the next six months, while 63 per cent said higher interest rates have put their purchasing plans on hold.
Meanwhile, as the consistent interest rate hikes fuel fears of a recession, 57 per cent of Canadians surveyed said they have decided to wait to purchase a new home or sell their existing one until the economy stabilizes.
After predicting in late 2021 that sale prices would increase by 9.2 per cent by the end of this year, Remax is now saying price growth “appears to be easing,” with some markets growing at a slower rate while others will see modest declines.
The new outlook reflects a similar adjustment by Royal LePage last week, whose latest House Price Survey slashed the company’s national market forecast for 2022 from 15 per cent growth to five per cent.
Alexander says the interest rate hikes have diminished Canadians’ buying power, particularly if home prices are also starting to fall, creating “an interesting time” in the real estate market.
What happens next will depend on whether more supply can be created to meet the demand and how much higher interest rates are hiked up in the near future, he added.
“It still remains to be seen where the market is going to go and how it will react to all this,” he said.