According to the Canadian Mortgage and Housing Corporation (CMHC) 2025 Mortgage Consumer Survey, there has been a recent increase in first-time buyers entering the market and they feel more financially prepared to become owners.
The survey shows that the first timer took an average of 3.4 years to save upfront payments, down from the 4.2-year average reported last year. According to this year’s research, they also spent an average of 6.3 years on the rental market before their first purchase.
Rule changes have an impact
The proportion of new entrants to new markets is relatively high compared to last year, which could be the result of new federal regulations and rules changes, lower interest rates, and lower home prices.
“I think a lot of that is due to the rule changes that have occurred in insurers over 30 years of amortization – all three insurers’ data suggests that many of their applications fall into that bucket,” said Joe Jacobs, managing partner at Mortgage Connect. “This plus people who put five to 10% down, which undoubtedly reduces the cost of qualifying and ultimately home ownership.”
Jacobs doubts first-time buyers will say they are ready for financial preparation to buy a home under previous requirements and restrictions.
Gifts, common signals and inheritance are driving today’s housing market
First-time home buyers are also increasingly relying on external support and family assistance. According to the survey, 41% use gifts or estates to pay for mortgage costs, up from 30% last year, with an average gift of nearly $80,000.
“In the past decade or so, great appreciation [in home values] First-time home buyers have a hard time getting into the market,” explained Bud Jorgenson, vice president of TMG Mortgage Group, Prairie Region. “At the same time, it creates wealth for people over 50 (their parents). ”
It’s not just a newcomer turning to a family. The survey found that 20% of repeat buyers also received financial help through gifts or estates, with the average price of these donations as high as $103,382.
In addition to financial gifts, Canadians are increasingly relying on other forms of support to enter the housing market.
The survey found that more than half of first-time buyers purchased the home with people other than their spouse or romantic partner.
“This means that more than half of the people who buy in today’s market are actually getting co-signers to help them, and that will be 99% of the parents in the case,” Jorgensen said.
“I’m not exaggerating when I almost every time I trade with a first-time buyer, there’s some kind of problem that qualifies them for the house they want,” he added. “It’s harder than getting into a house now, so people are looking for help with down payments, or seeking co-signatures from parents to provide additional income in the deal to qualify under the current ratio requirements.”
From renewal tsunami to refinancing wave
While many are concerned about the 2025 “update tsunami” and the 1.2 million borrowers who have boomed mortgages from the ultra-low pandemic have reached a five-year end, the slowdown has helped mitigate the impact.
Clinton Wilkins, team leader at Centum Home Lenders Ltd, said: “Luckily, we have avoided the cliffs of renewal over the past few months.
According to a CMHC survey, 20% of refineries shortened amortization period, while only 10% of home buyers, the difference did not surprise Wilkins.
“We’re seeing a lot of mortgage lenders get more percentages in amortization,” he said. “One, because the rates are high, but then other dollars in the wallet are extended due to inflation.”
CMHC survey results show that 28% of refineries use these funds for home renovations, 22% for consolidated debt, and 14% for reducing their monthly mortgages.
“It’s an important statistic; historically, you don’t see that,” Jacobs said, referring to the share of refinancing investors who use funds to cover the cost of a mortgage. “This shows that cash flow and debt management are actually the minds of many Canadians and homeowners.”
Renovation country
Canadians who do not use home equity to reduce debt or monthly spending are increasingly turning to renovations.
The study found that 66% of refiners have completed renovations over the past three years, and 77% plan to complete renovations over the next five years. More broadly, 55% of Canadian homeowners have undergone renovations during this period, and energy-efficient upgrades are the most popular choice.
“They revisit their equity in just four times in their 25-year mortgage life,” Jorgenson explained. “If you buy a house, and then live and pay off the house, you have four opportunities to refinance and withdraw some equity and use it for family improvements, and there are 1.2 million Canadians who can renew this year, which is what we are seeing now.”
In addition to the popularity of home renovation projects, Jacobs said new incentives are provided for energy-efficient upgrades and secondary suite expansions as well as the relatively challenging housing market.
“Everyone understands the cost of utilities better, so it’s not surprising that we’re seeing growth in renovations,” he explained. “There are also a lot of municipalities that offer incentives for secondary suites, so you can see this kind of renovation, whether it’s a carriage house or a basement suite.”
Given the unique and increasingly complex market conditions faced by first-time buyers, repeat buyers, updaters and refiners, Jacobs said Canadians need objective professional advice now more than ever.
“The conversation has to be more in-depth to figure out consumer needs and pain points,” he said. “The bigger conversation now has to be done because the home ownership that people are still interested in – it doesn’t seem to disappear – but they have more questions and brokers have the opportunity to provide that guidance.”
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Bud Jorgenson Canada Mortgage and Housing Company Clinton Wilkins CMHC CMHC CMHC Consumer Survey First Home Buyer Home Renovation Project Jared Lindzon Joe Jacobs Mortgage Consumer
Last modified: May 23, 2025
