Many renters still holding off on buying, despite falling rates and prices

More than a quarter of Canadian renters considered buying before signing or renewing their current lease, according to a new Royal LePage survey, but most ultimately chose to wait.

Even with home prices softening and borrowing costs easing, 40% of surveyed renters said they’re holding out for even lower prices. Another 29% are waiting for further rate cuts, while 28% say they’re still saving for a down payment.

Despite these hurdles, 54% of renters say they plan to buy eventually. Of those, 16% hope to do so within two years, and 21% within five.

“Entry-level opportunities have improved significantly,” said Royal LePage CEO Phil Soper, who noted that incomes are rising and some of the least affordable cities are becoming more accessible. “Still, many renters… are choosing to wait. History suggests they may be disappointed.”

A growing supply of purpose-built rentals and softer demand—partly due to capped international student permits—has also eased rental prices. According to Rentals.ca and Urbanation, average national rents for one- and two-bedroom units declined 3.6% and 4.6% year-over-year, respectively, in May.

Still, affordability remains an issue. Nationally, 37% of renters spend between 31% and 50% of their net income on rent, and 15% spend more than half. Many are also cutting back—on groceries, savings, or even taking on second jobs—to keep up.

“Even with several months of decreases, rents are still significantly higher than they were just a few years ago,” Soper said, calling for “meaningful policy action” to restore long-term affordability.

Source: Canadian Mortgage Trends