Canada NewsWire
TORONTO, June 5, 2023
TORONTO, June 5, 2023 /CNW/ - BMO's Real Financial Progress Index reveals that while homeownership is considered an important financial milestone for many Canadians, concerns about interest rates, inflation and a possible economic recession have affected their approaches to homebuying.
The survey found that over two thirds (68 per cent) of Canadians are planning on waiting until mortgage rates drop to purchase a home. The majority (68 per cent) of Canadians feel buying a home is more out of reach compared to their parents. Gen Z (ages 18 to 24) (71 per cent) are the most likely to have this outlook, followed by younger Millennials (ages 25 to 34) at 69 per cent and older Millennials (ages 35 to 44) at 65 per cent.
According to BMO Economics, Canadian housing activity has rebounded from the slow start in 2023, with home prices firming and existing home sales increasing by 11.3 per cent in April – the largest monthly rise since 2009. However even after last year's price correction, the combination of past price gains and higher mortgage rates leaves housing affordability near the most challenging level in more than 30 years. The survey found Canadians' perceptions of the economy have affected their homebuying plans:
"Homeownership continues to symbolize real financial progress, success and security for many Canadians and their families," said Gayle Ramsay, Head, Everyday Banking, Segment & Customer Growth, BMO. "While the challenging market and economic conditions may pose hurdles and uncertainty, we encourage Canadians to work with a professional advisor or planner to explore the many paths to homeownership and develop a personalized financial plan to help them get into the home they want within a realistic timeline."
Paths to Homeownership
The survey also explored the different financing strategies Canadians intend on using for their home purchase:
BMO Helps Canadians Make Real Financial Progress with Pre-Qualification Tool
To help Canadians get started with their homebuying journey, BMO has launched Pre-Qualification, an online tool that enables prospective homebuyers to get a mortgage estimate in one minute with a 130-day rate hold. Using a soft credit check that will not affect their credit scores, customers will be able to know how much they can potentially afford for a home based on information including income, assets and debt.
"Amid this challenging and changing market, homebuyers are keeping a keen eye on interest rates," said Hassan Pirnia, Head, Personal Lending and Home Financing Products, BMO. "Regardless of when buyers are planning their purchase, it's essential they have a clear understanding of budget and affordability at the start of their homebuying journey. BMO's new pre-qualification tool is an important first step in that journey and provides a mortgage estimate to give buyers more clarity as to what they can afford and what carrying costs they should be considering."
BMO offers tools and resources to help customers throughout their homebuying journey including:
For more information about BMO's Pre-Qualification tool, visit www.bmo.com/main/personal/mortgages/pre-qualification.
For more information about first-time home buyers programs and affordability tools, visit: www.bmo.com/main/personal/mortgages/first-time-home-buyer/.
To learn more about how BMO can help customers make financial progress, visit www.bmo.com/main/personal.
Launched in February 2021, the BMO Real Financial Progress Index is an indicator of how consumers feel about their personal finances and whether they are making financial progress. The index aims to spark dialogue that will help consumers reach their financial goals and to humanize a topic that causes anxiety for many – money.
The research detailed in this document was conducted by Ipsos in Canada from March 28th to April 28th, 2023. A sample of n=2,350 adults ages 18+ in Canada were collected. Quotas and weighting were used to ensure the sample's composition reflects that of the Canadian population according to census parameters.
BMO Financial Group is the eighth largest bank in North America by assets, with total assets of $1.25 trillion as of April 30, 2023. Serving customers for 200 years and counting, BMO is a diverse team of highly engaged employees providing a broad range of personal and commercial banking, wealth management, global markets and investment banking products and services to over 13 million customers across Canada, the United States, and in select markets globally. Driven by a single purpose, to Boldly Grow the Good in business and life, BMO is committed to driving positive change in the world, and making progress for a thriving economy, sustainable future and inclusive society.
SOURCE BMO Financial Group
View original content: http://www.newswire.ca/en/releases/archive/June2023/05/c7261.html
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