Rising Inflation, Not Interest Rates Primary Concern for Homebuyers as Anxiety About Market Runs Hot

Canadian homebuyers cite unaffordable house prices and rising inflation as concerns around homebuying, with 66% reporting they don't think they can afford to buy a home in their city.

TORONTO, May 24, 2022 /CNW/ - Are Canadians worried about rising interest rates affecting their ability to enter the housing market? What about inflation?

In a new survey released by Zolo, one of Canada's most popular real estate marketplaces, more than 800 prospective homebuyers shared their feelings about the current housing market and how it will impact their home-buying plans in 2022.

A new Zolo survey finds that 66% of Canadians don't think they can afford to buy a home in their city, and 71% worry they'll never be able to buy a home. (CNW Group/Zolo)

Canadian homebuyers cite house prices and inflation as barriers to home buying. 66% can't afford a home in their city.

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The results highlight that although most Canadian homebuyers worry they can't afford to enter the housing market, they still feel that real estate is a good investment and that prices will continue to rise in 2022.

The survey revealed that:

• 63% don't feel that they can afford to buy a home in 2022
• 71% worry they'll never be able to buy a home
• 78% of survey respondents think that house prices will increase in 2022
• 66% feel that housing prices aren't in line with what they can afford

Inflation, Not Rising Interest Rates Concern Homebuyers

The Canadian economy is in flux, with inflation at a 31-year high and the Bank of Canada promising to raise interest rates from the current benchmark of 1%. While both factors pinch Canadian budgets, 50% of those surveyed said interest rates are not impacting their decision to buy. Instead, 57% of respondents agreed that inflation would affect their ability to buy a home.

66% of Canadians Worry They Can't Afford a Home in Their City

While affordability varies from province to province, Zolo's survey indicates that about 66% of Canadians don't think that house prices in their city align with what they can afford. This percentage varies by province:

• 79% of British Columbians, where prices have increased 24.2% year-over-year
• 76% of Ontarians, where home prices have increased 25.3% year-over-year
• 53% of Albertans, where home prices have increased 15.5% year-over-year
• 59% of Manitobans, where home prices have increased 14.5% year-over-year
• 63% of New Brunswickers, where home prices have increased 30.7% year-over-year
• 64% of Newfoundlanders, where home prices have increased 5.9% year-over-year
• 59% of Nova Scotians, where home prices have increased 23.3% year-over-year
• 70% of Prince Edward Islanders, where home prices have increased 8.5% year-over-year
• 56% of Saskatchewanians, where home prices have increased 3.8% year-over-year

About Zolo

Zolo is one of Canada's most popular national real estate marketplaces. Each month, over 10 million home shoppers use Zolo to level up how they buy, sell, rent, finance and learn about real estate.

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SOURCE Zolo

Jordan Brown, Zolo, [phone], [email protected]