Novice Homebuyers Who Got Family Help Aren’t Feeling Good About Their Debt

According to a survey conducted by the federal housing agency released recently, nearly one in five first-time homebuyers received help with a down payment from a family member.

Canada Mortgage and Housing Corp. said 18 per cent of first-time buyers who took part in the survey said they received a gift from a family member as part of their down payment. This was the first time CMHC included the question as part of its annual mortgage consumer survey.

CMHC stated that these first-time buyers who received financial help of some sort to take care of their down payment were more unlikely to find the process of getting a mortgage easy and straightforward.

“First-time buyers who received a gift from family as part of their down payment were less comfortable than others with their current level of mortgage debt,” the agency said.

“They were also less confident about knowing where to turn in the event that they run into financial trouble. Similarly, they were less likely to have other assets to supplement their needs should they run into financial trouble.”

The survey comes following concerns that record household debt is a key risk for the Canadian economy.

The federal government has stiffened mortgage lending rules several times in recent years. This includes expanding stress tests on mortgages.

The poll discovered that just over half of buyers were aware of the latest mortgage qualification changes and about one in five noted that the latest changes affected their purchase decision.

CMHC’s annual mortgage consumer survey was as online completed in March and included 3,002 recent mortgage consumers.

The Marketing Research and Intelligence Association, which is the polling industry’s professional body, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.