Owning a home, or even preparing to own a home, builds better financial habits and creates a sense of optimism and security about an individual’s personal financial future, according to a recent survey.
Forty-three per cent of those who bought their first home within the past two years and those intending to buy soon say they are in good financial shape, according to an annual financial fitness survey of 1,533 Canadians, conducted in February by Environics Research Group. The survey was commissioned by Genworth Financial Mortgage Insurance Company Canada (Genworth Canada) and the Canadian Association of Credit Counselling Services (CACCS).
Of the same group, 36 per cent said they were able to pay all their bills and still save money for their down payment, and 64 per cent said they enjoy planning their finances.
First-time buyers pay down more of their credit card debt each month than the general population, and 40 per cent have set a goal of paying down their mortgage as quickly as possible, the results showed. Sixty per cent also have a long-term plan for retirement.
“We believe the results indicate that first-time buyers who are saving for a home adopt good financial habits such as budgeting and paying down debt,” says Henrietta Ross, chief executive officer of the CACCS, an association of agencies offering education, counselling and services to people experiencing financial difficulties. “We also see that this group has a better handle on, and control over, their finances than the population at large.”
The survey also found that the experience of homeownership seems to give people a positive feeling about their personal financial progress: 72 per cent of homeowners believe their financial situation will improve in the coming year, compared to 54 per cent of respondents who did not own homes.
“Homeownership seems to highly motivate people like few other goals,” Ms. Ross says. “Canadians value the achievement of owning a home and see it as an important goal in life that provides immediate and ongoing benefits.”
For example, 94 per cent of first-time buyers said homeownership gives them a greater sense of well-being and security. The survey provides evidence that making homeownership an achievable goal pays off, and that Canadians take a responsible attitude towards mortgage debt.
“First-time homebuyers are the engine that will drive the housing market in the next few years,” says Brian Hurley, chairman and CEO of Genworth Canada. “This survey helps us monitor Canadians’ attitudes on finances and homeownership so that we can continue to deliver the right tools and resources to educate homebuyers and promote responsible lending practices across the country.”
The CACCS encourages Canadians to visit www.caccs.ca to discover their personal financial fitness score or to call its toll-free referral service at 1-888-746-3328 to find a certified credit counsellor for advice on personal finances.