Interest rates

38% of Canadians don’t know what rising interest rates mean for them: TD

Misunderstandings about rising interest rates are creating anxiety and fueling uncertainty among Canadian homeowners and potential buyers, according to a new survey.

The TD Real Estate Survey found that 26% of Canadians do not fully understand the impact of rising rates, while 38% are confused about what the increases mean for them. Nearly 40% do not know the difference between variable and fixed interest rates.

Thirty-one percent of respondents believe that interest rates have no impact on them or their mortgage.

Conducted between May 20 and May 25, the national survey included responses from 2,000 Canadians aged 18 and older.

“Rising interest rates are affecting all Canadians, especially those looking to become homebuyers in the near future and those looking to renew their property,” said Frank Psoras, Senior Vice President, Secured Home Lending at the TD.

Despite the uncertainty caused by rising interest rates, 58% of current homeowners expect to take action with their property in the next year. Forty-two percent are planning to renovate, while 13% are likely to sell.

The survey revealed that many potential buyers are willing to compromise to enter the housing market. Twenty-six percent said they would give up the overall size of a home to make a purchase, while 29% said they would sacrifice outdoor space.

Of those hoping to buy a home in the next year, 76% say they are worried about the impact rising rates will have on what they can afford, while 27% admitted they don’t know or understand good number of costs associated with the purchase. a house.

“In today’s dynamic market, understanding the impact of rising interest rates is critical to establishing and maintaining financial health, no matter where you are on your journey home,” said Psoras.

Psoras encouraged current and potential buyers to meet with a mortgage specialist or financial adviser to get a clear idea of ​​what they can afford and make sense of the “complex and changing” real estate market.