A new survey from Canada Life reveals that current market conditions are changing people’s home ownership plans in a way that could impact their future retirement.

The survey found that market conditions such as high real estate prices are not only preventing many renters from entering the housing market, they’re also causing current homeowners to feel “house poor.” Almost half of the renters who responded (45 per cent) said they will either continue renting indefinitely or “aren’t sure” when they will buy a house.

“Canadians are at an investments crossroads,” said Paul Orlander, Executive Vice-President, Individual Customer, Canada Life. “While buying a home can help you build equity that could be valuable to one’s long-term financial plans, renting may provide more peace of mind around affordability, flexibility and lower housing costs which could leave more for savings and investments each month.”

Key highlights from the study include:

• Almost three-quarters (73 per cent) of respondents said “it’s a bad time to buy a house” with renters citing their top three reasons as 1) high real estate prices, 2) lack of money for a downpayment, and 3) not having enough income to qualify for a mortgage;
• While 79 per cent agreed that homeownership is a good investment, 64 per cent said they felt breaking into the market would be too difficult unless they had financial support from someone  such as a family member;
• Canadians aged 25-29 are two times more likely never to purchase a home or continue renting indefinitely compared to those aged 30-49; and
• 24 per cent of homeowners said they feel “house poor” today.

“Home ownership is one of the most important investments in one’s lifetime and with the right advice and long-term planning, a plan to build home equity should be one that is within reach for first-time homebuyers in Canada,” said Hugh Moncrieff, Executive Vice-President, Advisory Network and Industry Affairs, Canada Life. “Whether renting or buying, an advisor can help you plan for whichever works best for you. They can help you build an effective investment strategy, explain the long-term value of real estate within that strategy, knowing your first home isn’t always your forever home.”

For more on how market conditions are influencing future retirment planning, visit: Retirement (canadalife.com)