the rennie brief - Consumer Sentiment - May 2022

the rennie brief - Consumer Sentiment - May 2022

CONSUMER SENTIMENT the rennie brief

WHAT YOU NEED TO KNOW ABOUT CHANGING SENTIMENT IN METRO VANCOUVER • A survey of consumer sentiment in Metro Vancouver was recently conducted by rennie intelligence, in partnership with Mustel Group. • The survey sheds light on consumer expectations and potential future behaviours, adding a layer of insight that does not often accompany traditional housing market metrics. • Key findings include a slight increase in buying intentions in the next 6 months, with pre-sale poised to meet some of the increased future demand.

MAY 2022

A recent survey of Metro Vancouver residents shows continued engagement in the housing market and an expectation of rising home values, despite deepening concerns about personal finances.

Additionally, the proportion of respondents indicating an intention to sell their home in the next 6 months is approximately half of the proportion intending to buy (17% vs 33%); this suggests that the pre-sale market has the potential to play a significant role supporting housing demand. AN EXPECTATION OF RISING HOME VALUES One of the larger response shifts in our consumer sentiment survey between October 2021 and April 2022 was in the context of future home values. More specifically, 69% of respondents in our October survey said they expected home values to be higher in one year, versus 62% in our April survey. As well, the proportion of respondents who indicated they expect home values to be lower in one year doubled between October and April, from 8% to 16%. While these changes are material—and likely a function of some combination of rising interest rates, growing economic uncertainty, and home price fatigue—it is worth underscoring that almost 2/3 of respondents continue to anticipate that home values will rise in the next 12 months. GROWING CONCERNS OVER PERSONAL FINANCES More respondents indicated, as part of the April survey, that they expect their personal financial situation to be worse in one year (21%) than did as part of the October survey (15%). Again, this is not surprising when considered against the backdrop of too-high inflation and rising interest rates. Meanwhile, fewer respondents expected to be better off in one year in April (31%) than in October (34%). Overall, the most common response in April—equating to about half of those surveyed—continues to be that consumers’ financial situations will remain unchanged one year from now. TAKEAWAYS FROM THE APRIL 2022 SURVEY As it relates to housing and personal finances, consumer sentiment in Metro Vancouver has clearly shifted since October, with growing concern around worsening macroeconomic conditions. That said, residents continue to perceive the local housing market as being resilient despite the increased headwinds.

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