Despite the uncertainty the COVID pandemic has caused for Toronto's real estate market, residents are still interested in buying a new home in the coming months, according to a new survey from the Toronto Regional Real Estate Board (TRREB).
To get a better understanding of how the COVID-19 pandemic has impacted consumers, TRREB contracted Ipsos Public Affairs to conduct an online survey on home buying and selling intentions along with consumer opinions on preferred government policy directions related to the housing market.
Even with home sales and new listings down, 27% of survey respondents in the GTA said they are very likely or somewhat likely to purchase a home in the next 12 months. However, while buying intentions were down compared to spring 2019 (31%), they remained relatively in line with the five-year trend, especially after taking into account survey credibility intervals.
Here in Toronto, home buying intentions were above those in the GTA, with 34% of respondents saying they are very likely or somewhat likely to buy a new home within the next year. What's interesting to note is home buying intentions were stronger for younger people aged 18 to 34 (45%) and for those with children (37%).
As for those who said they didn't want to buy a home over the next 12 months, general affordability issues were a top concern, while 62% of respondents said they liked their current home and 16% said they didn't want to move due to COVID-19-related issues.
“While COVID-19 has temporarily impacted home sales and listings in the GTA, the Ipsos survey results that show home buying intentions have remained quite stable certainly suggest that many people will be looking to satisfy pent-up demand for ownership housing once recovery starts to take hold," said TRREB president, Michael Collins.
"As people gradually return to work, consumer confidence will improve, and a growing number of people will look to take advantage of very low borrowing costs to purchase a home. Home purchases will continue to be aided by the use of technology available to REALTORS®, including live-stream open houses,” said Mr. Collins.
When it comes to selling, 17% of existing homeowners said they were likely to list their home in the next 12 months, compared to 32% of homeowners in spring 2019.
According to the survey, a very large proportion (80%) of respondents indicated that they were unlikely to list their home for sale simply liked the home in which they are currently living in, while 22% said they weren't going to list due to COVID-19-related issues.
"The supply of listings was an issue before the onset of COVID-19, with market conditions tightening and price growth accelerating throughout the first quarter of 2020," said Jason Mercer, TRREB’s Chief Market Analyst.
"The Ipsos survey results suggest that the supply of listings will continue to be an issue as the economy and housing market recovers. Policymakers have acknowledged that there is a lack of a diverse housing supply in the GTA. While the supply issue has understandably taken a back seat to COVID-related issues in the short term, it should once again be top-of-mind once recovery takes hold,” said Mercer.
With consumers still concerned about affordability, the survey results also showed that public support for government assistance for homebuyers hasn’t changed since the pre-COVID-19 period.
According to TRREB, 82% of respondents support increased and more flexible access to Registered Retirement Savings Plans through the Home Buyers’ Plan; 75% support relief from municipal and/or provincial land transfer taxes; 73% support relief from municipal property taxes; 71% support relaxation of federal mortgage insurance rules to allow homebuyers the option of qualifying for a mortgage with smaller down payments; and 65% support relaxation of the federal mortgage “stress test.”
“Homeownership affordability is and will continue to be, a top concern as the economy recovers from the impact of the COVID-19 pandemic," said TRREB CEO John DiMichele.
"With this in mind, it is not surprising that there is public support for government assistance in this regard. There is a definite role for governments to play in addressing affordability concerns, but policymakers at all levels should proceed with caution and assess the impact of pent-up demand and the potential lack of listing inventory during the initial recovery period,” said DiMichele.