In This Article:
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Majority of Canadians believe housing affordability will worsen in 2025
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One-quarter (24 per cent) predict mortgage rates will increase this year
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More than half of renters expect their rent will increase
WINNIPEG, MB, Feb. 11, 2025 /CNW/ - According to findings from the seventh annual edition of the IG Wealth Management Financial Confidence Index ("the Study" or "the Index"), the majority (56 per cent) of Canadians believe housing affordability will worsen this year.
While economists predict a housing market rebound, Canadians remain weary that rising costs will continue to put homeownership further out of reach.
The Index, commissioned by IG Wealth Management ("IG") and conducted in partnership with Ipsos Canada, found that:
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One-quarter (24 per cent) predict mortgage rates will increase this year.
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More than half (57 per cent) of renters expect their rent to increase over the next year.
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Over half (54 per cent) of homeowners are more comfortable making a major purchase – like a car – compared to a year ago, versus only 38 per cent of renters.
Canadians' concerns about housing costs are well-founded. As of November 2024, the average home price in Canada reached $696,166, marking a six per cent increase from 2023, according to the Canadian Housing Market Report. In some specific provinces that growth is more striking, for instance regions like Alberta experiencing a 19.5 per cent increase in home prices since last year.
"Housing affordability is a persistent concern for Canadians coast-to-coast," said Alana Riley, Head of Mortgage, Insurance and Banking at IG Wealth Management. "With the right mortgage strategy, as part of an integrated financial plan, financial advisors can help Canadians with a tailored, long-term solution that will align with their lifestyle and financial goals, providing them with peace of mind and a sense of financial security."
Renters Grapple with Mounting Challenges in Today's Housing Market
In 2024, the average rent for a two-bedroom apartment in Canada rose by 5.4 per cent to $1,447, reports the Canada Mortgage and Housing Corporation. While this is lower than the eight per cent increase in 2023, affordability remains a challenge, particularly for new tenants facing significant rent hikes. As a result, four in ten renters are expecting to downsize or share living spaces with others, according to the Study.
The Study also shows clear regional differences in housing affordability, with Quebec hit hardest. Three-quarters (75 per cent) of renters in the province expect rent increases this year, compared to the national average of 57 per cent.