Rising interest rates mean Canadians need the right mortgage advice

The affordability of home ownership is another top issue, Ms. Lucreziano says. The average price of a home in Canada was $746,000 in April, according to the CREA.

Half of the poll respondents who are non-homeowners told CIBC they don’t believe they would be able to afford to buy without a co-owner. That’s up five per cent from a year prior.

Among renters, 54 per cent say they cannot afford to buy a home — up seven per cent from the year before, Ms. Lucreziano points out.

“It’s an opportunity to think about exploring the different options out there for homeownership,” she says. “Some emerging trends we’ve seen are purchasing a home with a family member or friend, as well as purchasing a property with the potential for rental space to help cover mortgage costs.”

Over the past few years, Canadians have considered buying outside of major cities in more affordable communities, a trend that will continue. Thirty-eight per cent of renters polled say they would consider such a move to help achieve their homeownership goals.

As Canadians adjust their home buying strategies, professional advice is paramount to ensure they understand their options and what is possible, Ms. Lucreziano says.

An advisor can help sort through financing options, set up a savings plan for a down payment and work through a mortgage pre-approval. They can also explain the many programs available to aid in home ownership, including tax credits and the new federal tax-free First Home Savings Account.

“It is never too early to start, and getting the right advice is so important,” Ms. Lucreziano says. “Ensure that you’re working with someone that understands your goals, your timelines, and can really help you see the end stage and that goal in the future.”

For first-time homebuyers, it really is important to plan ahead, she says, including pre-approval for a mortgage, which doesn’t guarantee formal approval but gives buyers an idea of what they can afford.

For current homeowners, it’s important to understand the terms and conditions of their existing mortgage so they can explore financing options for changing or renewing, she adds.

There are several online tools to help Canadians visualize their path to homeownership. CIBC’s mortgage affordability calculator and budget calculators can help you get started today.

While the pace of home sales may have slowed slightly, the same cannot be said for home improvements and renovations. A third of Canadians have renovated in the past year and another third plan to do so in the coming year.

The survey found that 30 per cent of homeowners have made energy efficiency improvements in the past year or plan to in the next 12 months. Many of those home improvements are driven by a desire to improve energy efficiency to save money on costs and increase the value of homes. Energy efficiency was number three on the list of factors potential buyers are considering when house hunting — after location and cost.

“Home energy efficiency is not only good for the environment, but it helps reduce energy costs and that’s what we’re seeing people are very interested in,” Ms. Lucreziano says. “It’s an investment that will help you save on the future costs of homeownership.”

Yet, the survey shows more than half of Canadians are not aware of government programs and rebates to support energy efficiency, she points out. A professional advisor can also help homeowners sort through the various federal, provincial and, in some cases, municipal rebates that make renovations more affordable.

“There is a big, big opportunity for Canadians to obtain advice,” Ms. Lucreziano says. “There are just so many options out there to think about.”

From March 28 to March 31, 2022 an online survey was conducted of 1,521 randomly selected Canadian adults who are homeowners, renters or co-inhabitants, and who are panelists of Maru Voice Canada Opens in a new window.. This survey was executed by Maru/Blue Opens in a new window.. For comparison purposes, a probability sample of this size has an estimated margin of error, which measures sampling variability, of +/- 3%, 19 times out of 20.

Originally published in The Globe and Mail, June 2022.