Canadian homeowners facing mortgage renewals are preparing to cut their budgets to manage higher payments, while prospective buyers are preparing to make a move later this year.
According to a new survey from TD Bank, more than half (56%) of Canadian homeowners said they will reduce their household spending to cope with the increased costs on their mortgages, while nearly four in 10 (39%) expect to rely on savings or invest less. This redirecting of their budgets is creating a stressful environment, with more than two-thirds (67%) of homeowners polled admitting that they feel uneasy about their mortgage renewal.
Regarding the mortgage renewals, nearly two-thirds (64%) are planning to renew at a fixed rate, while two in five homeowners (40%) said they will shop around for a new lender at renewal. Only 9% of homeowners said they’ll start renewal conversations earlier with their lender or mortgage broker.
“Mortgage renewal can feel overwhelming and Canadians appear to be feeling that pressure,” said Patrick Smith, TD’ Bank’s vice president of real estate secured lending. “In an evolving rate environment, understanding your options and planning ahead through earlier renewal conversations can help Canadians feel more confident, make clearer choices and stay in control of what comes next.”
As for prospective homebuyers in Canada, three in 10 (30%) surveyed said they are now more likely to enter the housing market before the end of the year, with lower home prices (50%) and stable interest rates (35%) driving buying decisions. But half of potential buyers admitted that they are leaning on their investment income (52%) and trimming non-essential spending (48%) to support their home purchase.
The survey polled 1,502 Canadian adults throughout February.
0 Comments