Half believe owning a home is less attainable than in 2024.
43% of homeowners say they could not have purchased their home without family assistance.
TORONTO, May 5, 2025 /CNW/ - The latest BMO Real Financial Progress Index reveals that while over two thirds (67%) of homebuyers are waiting for interest rates to drop before purchasing a home– a 5% decrease from 2024– experts say many more Canadians may take a "wait and see" approach as concerns about the prospect of an economic recession increased from 60% to 74% from March to April 2025.
"Canada's housing market remained under pressure heading into the spring, with sales and prices both weakening further," said Robert Kavcic, Senior Economist, BMO Capital Markets. "There is some clear underlying weakness as inventory builds and investors remain absent. Suffice it to say, homebuyers are losing confidence and motivation, especially in areas of B.C. and Southern Ontario."
The BMO survey examines how concerns about the economy have influenced Canadians' homebuying decisions:
Revisiting Rates: Over two-thirds (67%) of prospective homeowners believe rates affect their buying decisions. Two in five (38%) Canadians are waiting for rates to drop to 3% or lower before purchasing or refinancing home. In addition, 44% admit they are unsure about the rate they would be comfortable with to move forward with buying or refinancing their home.
Missed Momentum: When looking at the current housing market, 56% of prospective homeowners feel they missed their moment to buy a home. Two-thirds (66%) of Millennials feel they had missed their homebuying moment – more than any other generation.
Challenged Confidence: While 59% of Canadians believe homeownership is one of their greatest life aspirations, half (50%) believe owning a home is less attainable than it was 12 months ago, and two-thirds (66%) are less confident that they will own a home in their lifetime compared to five years ago.
Deferred Demand: Among the 38% of homebuyers planning on purchasing a home in the near future, only 14% plan to in 2025 and a quarter (24%) plan on doing so in 2026 or later.
Location, Location, Location: More than half (52%) of aspiring homebuyers would consider moving to a different province or country in order to afford buying a home.
"While current economic conditions present uncertainties and challenges, there are opportunities for Canadians to achieve the goal of homeownership with guidance and planning," said Gayle Ramsay, Head, Everyday Banking Segment & Customer Growth, BMO. "Working with a professional advisor can help homebuyers stay informed and navigate the current environment, understand the strategies available, then develop a personalized plan that prioritizes resilience and long-term stability, empowering them to pursue homeownership while making real financial progress."
Despite short-term concerns about the housing market, the BMO Real Financial Progress Index found over two thirds (70%) of Canadians feel confident in their financial situation, but fear of unknown expenses (82%), concerns about their overall financial situation (81%) and housing costs (72%) are among the leading sources of financial anxiety.
Reimagining the Canadian Dream
While 57% of homebuyers believe homeownership is more about attaining a life milestone than making a good investment, many are re-evaluating their approach to homebuying:
Bank of Mom and Dad:
43% of homeowners say they could not have purchased their home without assistance from family.
Over a quarter (27%) of Canadians expect financial support from their parents and/or grandparents, with 6% expecting assistance for the down payment for a home, 8% expect help with monthly rent and 7% expecting support for home renovation costs.
Among the 39% who plan to provide financial help for their child(ren) and grandchild(ren), 5% plan to contribute to the down payment for their home and 4% plan to contribute toward their First Home Savings Account (FHSA).
Shared Homeownership: 45% would consider buying a home with friends, family members or other people they are not romantically involved with, with Gen Z (63%) and Millennials (50%) being the mostly likely to consider a shared homeownership approach.
Reconsidering Renting: 61% of Canadians are content renting and do not feel pressured to buy a home, a sentiment highest among Boomers (83%) and Gen X (61%). Over half (51%) of Canadians believe renting is more flexible.
"While homeownership continues to represent financial progress for many, we are finding Canadians are beginning to explore new and different pathways to meet their goals as economic uncertainty grows and priorities shift," said Ms. Ramsay. "As many first-time homebuyers explore new options or wait for their chance to enter the market, we encourage Canadians to work with a professional advisor or planner to learn more about the different paths to homeownership and build a personalized financial plan them get into the home they want within a realistic timeline."
BMO Helps Homebuyers Make Real Financial Progress
BMO offers convenient tools and resources to help customers throughout their homebuying and homeownership journey including:
First Home Savings Account (FHSA): 58% of Canadians plan on using the FHSA and/or Home Buyers' Plan (HBP) from their Registered Retirement Savings Plan (RRSP) for their home purchase. The FHSA is a tax-advantaged registered savings plan that combines the benefits of a Registered Retirement Savings Plan (RRSP) and a Tax-Free Savings Account (TFSA), where contributions are tax deductible, earnings are tax-sheltered, and withdrawals are tax-free when used towards qualified first-time home purchases. First-time home buyers can contribute up to $8,000 a year, with a lifetime contribution limit of $40,000.
BMO SmartProgress: Customers can learn more about homeownership, budgeting, and other personal finance topics from BMO SmartProgress. The online education platform organizes personal finance topics into playlists, enabling Canadians to learn more about how to manage their finances in a widely accessible and innovative platform.
Pre-Approval: For homebuyers, getting pre-approved provides a cushion for due diligence when purchasing a home. In addition to visiting a local branch to speak with an advisor, BMO offers the ability for homebuyers to apply for mortgage pre-approval online. BMO also offers the longest rate guarantee period of any major Canadian bank at 130 days.
Pre-Qualification: To get started with their homebuying journey, prospective homebuyers can get a mortgage estimate in one minute with a 130-day rate hold. Using a soft credit check that will not affect their credit scores, customers will be able to know how much they can potentially afford for a home, based on information such as income, assets, and debt.
Mortgage Renewal Tools: To help prepare for a mortgage renewal, customers can get a tangible sense of their mortgage payments upon renewal using BMO's mortgage renewal calculator. Customers can also view their personalized renewal rate 180 days before renewal and quickly renew their mortgage in the BMO App or Online Banking.
To learn more about how BMO can help customers make financial progress, visit www.bmo.com/main/personal.
About the BMO Real Financial Progress Index
Launched in February 2021, the BMO Real Financial Progress Index is an indicator of how consumers feel about their personal finances and whether they are making financial progress. The index aims to spark dialogue that will help consumers reach their financial goals and to humanize a topic that causes anxiety for many – money.
The research detailed in this document was conducted by Ipsos in Canada from March 3rd to 26th, 2025. A sample of n=2,500 adults ages 18+ in Canada were collected. To account for recent changes in the economic situation, certain questions were asked again among a sample of n=2,001 adults ages 18+ in Canada from April 17th to 20th, 2025. Quotas and weighting were used to ensure the composition of both samples reflects that of the Canadian population according to census parameters. The surveys have a credibility interval of +/- 2.7 per cent 19 times out of 20, of what the results would have been had all Canadian adults 18+ been surveyed.
About BMO Financial Group
BMO Financial Group is the eighth largest bank in North America by assets, with total assets of $1.5 trillion as of January 31, 2025. Serving customers for 200 years and counting, BMO is a diverse team of highly engaged employees providing a broad range of personal and commercial banking, wealth management, global markets and investment banking products and services to 13 million customers across Canada, the United States, and in select markets globally. Driven by a single purpose, to Boldly Grow the Good in business and life, BMO is committed to driving positive change in the world, and making progress for a thriving economy, sustainable future, and inclusive society.
