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The survey supports the housing industry by monitoring important mortgage and consumer trends. A key objective was to investigate sentiments and purchasing power of mortgage consumers.
New this year, we measured the level of awareness of and participation in the First-Time Home Buyer Incentive. We also explored the impact of COVID-19 on mortgage consumer needs and how it influenced their decisions.
Between February and March 2021, we contacted 3,502 recent mortgage consumers across Canada. We asked housing related questions of all kinds including consumer behaviour, attitudes and expectations.
Get the top key findings (PDF)of mortgage consumers indicated no change to their housing needs because of COVID-19.
of first-time buyers were aware of the First-Time Home Buyer Incentive.
of buyers paid the maximum price they could afford on the purchase of their home.
Recent mortgage transactions are mostly the renewal of an existing mortgage:
There are significantly more first-time homebuyers:
Most first-time buyers were renting with family or friends before they bought their first home:
One third of first-time buyers have been renting for 1 to 4 years:
When obtaining their current mortgage, 40% of all mortgage consumers obtained mortgage loan insurance while 56% did not.
Homebuyers were asked to select their 3 main reasons for buying:
The top reason for refinancing a mortgage is to reconcile debt!
Here’s the breakdown of what people said were the reasons for refinancing their mortgage:
A whopping 84% of mortgage consumers indicated no change to their housing needs because of COVID-19. A mere 14% indicated their housing needs had changed and 2% didn’t know.
When it comes to maintaining scheduled mortgage payments:
Eighty percent of consumers were aware of the Mortgage Payment Deferral Agreement for homeowners—repeat buyers having a higher awareness than other categories. For the remaining respondents 20% weren’t aware or didn’t know.
Among those who were aware of the agreement:
The majority of mortgage consumers—77%—agreed they value their home more than before the start of the pandemic. Of the remaining respondents, 15% disagreed or somewhat disagreed and 8% didn’t know. For those who were more inclined to agree:
We asked mortgage consumers how they felt about their current housing situation and this is what they responded:
We also asked buyers their level of agreement with a series of statements. They agreed or somewhat agreed with the following:
Close to 40% of buyers indicated that the pandemic impacted their purchase decision on the location of home. The pandemic impacted other decisions:
Younger buyers are more likely to indicate the pandemic impacted their purchase decision on physical space than older buyers.
A quarter of buyers indicated that they purchased their home sooner than expected due to the pandemic. Further, 9% postponed their purchase and 66% said there was no impact to their timeline.
About 21% of respondents indicated difficulty in maintaining their credit card payment. Mortgage consumers had difficulty maintaining other debt obligations:
More than a quarter—26%—of those aged 18 to 34 indicated difficulty in maintaining mortgage payments. About 23% have experienced an unexpected decrease in household income. Other financial impacts from the pandemic:
Financial impacts are more likely among those aged 18 to 34.
We found that 49% of buyers paid what they had planned to pay. This was particularly true for repeat buyers as 52% paid what they had planned, and 60% of buyers 65 and older paid what they had planned.
Just a little more than one quarter—27%—paid more than planned while 20% paid less than planned.
The survey indicated that 31% buyers were involved in a bidding war in the search for homes. When asked how they would describe their bidding war experience, 38% of buyers described it as very positive or positive. Other respondents had different experiences:
Nearly half of buyers agreed that they paid too much over the original listed price.
When asked about their level of agreement on other statements, we found:
When asked if this was the maximum price they could afford on the home just purchased, 65% said yes while 17% preferred not to say.
Results indicated that 46% of buyers felt uncertainty and concerns about buying a home, while 49% did not. Younger and first-time buyers are more likely to feel concerns or uncertainty.
Data showed that 54% were concerned about paying too much and 41% indicated that searching/finding the right home were the main causes of concern. Respondents also indicated other concerns:
We discovered that 53% of homebuyers discussed potential unexpected costs with their mortgage professionals, while 38% did not.
Results also indicated that 32% of buyers incurred unexpected expenses during the homebuying process, while 64% didn’t. In terms of unexpected expenses, 31% indicated immediate repairs and 28% said legal fees. Respondents cited other unexpected expenses:
When asked about the First-Time Home Buyer Incentive, 72% of first-time buyers were aware and 24% weren’t aware of the incentive. Of all that qualified for the incentive, 52% participated in the program.
The majority of first-time buyers think it’s a good way to help prospective homebuyers enter the housing market:
That said, the majority of first-time buyers would rather maintain the equity in their home.
Pricing and affordability was the top factor when considering buying their current home:
The majority of all buyers surveyed responded their current home meets or somewhat meets their overall needs:
Buyers mostly interacted with real estate agents and lawyers during the home buying process. A large percentage deal with lenders too:
Results indicated that real estate agents are the most valuable person in the homebuying decision. Other responses included:
Respondents indicated that the people they interacted with during the homebuying decision were valued for being knowledgeable and provided the best advice:
Buyers get recommendations to use a specific:
Family members and real estate agents are the main source of recommendations when choosing a lender. Respondents also indicated other sources:
More than 1/3 of buyers received a recommendation to use a mortgage broker from:
The survey asked buyers how much they spent on their home purchase:
Results showed that 37% of respondents paid more than 20% of home purchase price as down payment.
The main reason 47% of buyers put less than 20% down was a lack of funds. Other reasons included:
Data showed that 28% who put down greater or equal to 20% down payment wanted to avoid paying mortgage loan insurance. Respondents had other reasons:
There are several sources cited for a down payment, 38% had savings outside of an RRSP and 25% said equity from previous home. Respondents also indicated:
When asked about having gone through the home buying process and looking back, homebuyers used these words to describe it:
We found that 43% of mortgage consumers solely researched online for information about mortgage options. Both online and offline research was conducted by 33% of consumers, while 23% research offline only.
Online sources for mortgage information:
The majority of mortgage consumers—63%—didn’t use any social media platform for information gathering. Of those that did:
Data showed that 84% of mortgage consumers compared interest rates during the research phase. Other online research actions:
We found that 55% of respondents contacted one or more lenders, mostly first-time buyers aged 25 to 34 years. We also see that 38% of consumers contacted one or more mortgage brokers.
On average, 39% of respondents contacted 2 mortgage lenders.
The majority of mortgage consumers—77%—contacted 1 or 2 mortgage brokers.
We found that 70% of mortgage consumers have a fixed mortgage rate. This is particular among older mortgage consumers and repeat buyers.
Younger mortgage consumers are less likely to have a fixed mortgage rate. We can see that 33% of those aged 18 to 24 currently have a variable mortgage rate.
When it comes to mortgage renewal terms, 56% of mortgage consumers have chosen 5-year terms. It breaks down like this:
Of those aged 18 to 24, 33% chose 3 years for their renewal term.
Here’s what respondents said when asked about the amortization period for their current mortgage:
Close to half of first-time buyers—45%—and 51% of repeat buyers have amortization periods of 25 years and above.
We found that 41% of consumers have a monthly mortgage payment. Other mortgage payment frequencies:
For first-time buyers, 53% chose to have a monthly payment.
We asked mortgage consumers if they used a mortgage broker to take care of their mortgage negotiations.
Among those who didn’t use a mortgage broker, 94% arranged their current mortgage directly from a bank or financial institution. Further, 35% arranged their current mortgage through a mortgage specialist. Other responses included through a:
Getting the best mortgage rate or deal has a strong influence on the decision to use a mortgage broker. Respondents indicate other influential factors:
Consumers were presented about 3 offers from mortgage brokers, on average. Here’s the full breakdown of offers:
Types of information provided by mortgage brokers:
Other financial products offered:
Other types of information mortgage consumers would have considered useful to receive from brokers:
Generally, mortgage consumers were satisfied with their brokers and are likely to recommend them and work with them again. We asked them to what extent they agreed or disagreed with the following statements and they totally and somewhat agreed to the following:
The majority of first-time buyers—61%—took out their current mortgage with their existing financial institution, while 33% didn’t.
When asked if they changed lenders when obtaining their current mortgage, 21% of repeat buyers said yes while 78% said no.
Mortgage consumer loyalty skews highest (80%) for the youngest and oldest age groups. Overall, around 69% of buyers were loyal as they obtained a mortgage from their current bank or lender.
A better interest rate is the top reason for 30% of respondents to switch mortgage lenders. Other top reasons:
Mortgage consumers were asked the degree to which statements influenced their decision to use a mortgage lender. These statements had a great deal or some influence:
In the process of obtaining their current mortgage, consumers were provided with the following types of information or advice from their lender:
Only 26% of mortgage consumers were offered other financial products by their lender, 63% were not. That said, 75% of mortgage consumers are being offered a line of credit. Respondents indicated other financial products were offered:
Results indicate that 33% of mortgage consumers were contacted by their mortgage lender after the transaction was completed.
About 24% considered long-term mortgage and/or financial strategies following the mortgage transaction useful from their lender. Other types of contact considered useful:
We see that 79% of mortgage consumers are satisfied with their experience using a mortgage lender. Data also indicated that:
The majority of mortgage consumers—85%—agree that home ownership is a good long-term financial investment and 84% are confident that they will be able to make future mortgage payments. Other statements they agreed with:
We asked mortgage consumers to what extent they agreed with a series of statements related to the use of technology during the mortgage process. They totally or somewhat agreed to the following:
When it comes to renovations, 70% of consumers plan to do so in the next 5 years.
Nearly half of consumers (47%) plan to renovate to customize their homes to meet their needs and preference. Other reasons:
They expect their renovation will cost:
Results indicate that 64% plan to finance their renovations from savings. Meanwhile, other mortgage consumers plan to finance from:
We see that 68% of mortgage consumers are aware that renovation costs can be incorporated into their mortgage.
Results indicate that 42% of mortgage consumers have their mortgage payment set at an amount higher than the minimum required. Data further tells us that 44% pay the minimum and 14% don’t know.
More than a quarter of mortgage consumers—26%—increased the amount of their regular ongoing mortgage payment. Other actions taken since the mortgage transaction:
Actions mortgage consumers are planning to take in the future:
Results indicate that 67% of mortgage consumers currently operate on a monthly budget, while 32% don’t.
We can see that 61% of consumers incorporated a financial buffer in their budget to plan for the future, while 35% haven’t. Among those who incorporated a month financial buffer, we found that:
Gender
| Total | Renewer | Refinancer | First-time buyer | Repeat buyer | |
|---|---|---|---|---|---|
| Male | 50% | 50% | 53% | 41% | 51% |
| Female | 50% | 50% | 46% | 58% | 49% |
Age
| Total | Renewer | Refinancer | First-time buyer | Repeat buyer | |
|---|---|---|---|---|---|
| 18-24 | 3% | 2% | 4% | 10% | 1% |
| 25-34 | 17% | 13% | 16% | 48% | 14% |
| 35-44 | 26% | 27% | 24% | 29% | 23% |
| 45-54 | 20% | 22% | 17% | 10% | 19% |
| 55-64 | 20% | 21% | 22% | 2% | 23% |
| 65+ | 14% | 14% | 17% | 0% | 20% |
Education
| Total | Renewer | Refinancer | First-time buyer | Repeat buyer | |
|---|---|---|---|---|---|
| High School or less | 16% | 16% | 15% | 15% | 15% |
| College | 30% | 31% | 30% | 25% | 36% |
| University | 36% | 36% | 38% | 39% | 31% |
| Post Graduation | 17% | 16% | 17% | 19% | 18% |
Marital Status
| Total | Renewer | Refinancer | First-time buyer | Repeat buyer | |
|---|---|---|---|---|---|
| Single | 17% | 17% | 16% | 26% | 10% |
| Married/ Common Law | 71% | 71% | 71% | 67% | 75% |
| Divorced/Separated | 9% | 9% | 9% | 2% | 12% |
| Widowed | 2% | 2% | 2% | 2% | 2% |
Employment
| Total | Renewer | Refinancer | First-time buyer | Repeat buyer | |
|---|---|---|---|---|---|
| Employed | 68% | 67% | 67% | 84% | 61% |
| Self-Employed | 7% | 7% | 7% | 4% | 7% |
| Retired | 16% | 17% | 18% | 1% | 23% |
| Unemployed | 5% | 5% | 5% | 3% | 4% |
| Homemaker | 3% | 3% | 3% | 4% | 4% |
| Student | 1% | 1% | 0% | 4% | 0% |
Household Income
| Total | Renewer | Refinancer | First-time buyer | Repeat buyer | |
|---|---|---|---|---|---|
| <$45,000 | 12% | 13% | 11% | 12% | 12% |
| $45,000 - <$60,000 | 11% | 11% | 12% | 12% | 7% |
| $60,000 - <$105,000 | 36% | 35% | 36% | 39% | 34% |
| $105,000- <$125,000 | 14% | 12% | 14% | 20% | 15% |
| $125,000+ | 21% | 22% | 21% | 13% | 25% |
| Prefer not to say | 7% | 7% | 5% | 5% | 7% |
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