Majority of first time buyers in Manitoba and Saskatchewan want new and detached homes

- TD Canada Trust releases 2010 Home Buyers Report -

TORONTO, July 5 /CNW/ - More than in any other provinces, people in Manitoba and Saskatchewan would prefer a newer home over an older home if price points were similar (81% versus 75% nationally). Additionally, almost three-quarters of first time home buyers in the region are leaning towards fully detached homes. This is according to the first TD Canada Trust Home Buyers Report which surveyed Canadians who have purchased their first home in the past 2 years or who intend to purchase a home in the next 2 years.

Compared to those surveyed in other provinces, more respondents in Manitoba and Saskatchewan are expecting to pay market price or more for the features they're looking for. Thirty-six per cent expect to pay asking price and 9% expect to pay more (compared to only 29% and 6% nationally respectively). Fifty-five per cent say they expected or expect to pay less than asking price (versus 65% nationally).

"It's only natural to want your first home to be the home of your dreams, but it is important to be realistic about what you can afford as a down payment and what that will mean for both the type of home you buy and for your mortgage payments over time," says Farhaneh Haque, Regional Sales Manager, Mobile Mortgage Specialists, TD Canada Trust. "I advise first time home owners to consider a larger down payment because a 10% or greater down payment will make a big difference. It may mean that you need to save longer before buying your first home, but it will pay off in the end. Speak with a representative at your bank about setting up an automatic savings plan to help you save."

Home shopping process:

People in Manitoba and Saskatchewan spend more than 9 months looking for a home and view more homes than people in the rest of the country. On average, people in Manitoba and Saskatchewan view more than 15 homes before buying, in fact 20% of people in the provinces view more than 25 homes! They spend a lot of time shopping because they plan to spend many years in their first home. In fact, 55% of people in province plan to spend more than 10 years in their home or never plan to sell.

Home financing:

Nine-in-ten buyers in Manitoba and Saskatchewan report putting down as much as they can afford for a down payment (94%). Seventy per cent say they saved or plan on saving for two years or less for their home purchase.

Only 30% of home buyers in Manitoba and Saskatchewan plan to have more than a 20% down payment. The remaining 70% will require their mortgage to be insured by organizations like the Canada Mortgage and Housing Corporation (CMHC). In fact, on average people in this region plan to put down the smallest down payment 11.4% (compared to 13.1% nationally). More than half (52%) are worried about being able to afford their home if interest rates rise.

Seventy-one per cent of those surveyed in Manitoba and Saskatchewan have or plan to have a fixed-rate mortgage. "Historically you are more likely to save interest costs with a variable rate or short-term mortgage option, so if they can handle some volatility then I recommend buyers choose a variable rate. If people are adverse to interest rate fluctuations then a fixed-rate is best," says Haque.

People in Manitoba and Saskatchewan do their homework:

Nearly all home buyers are making informed financial decisions before buying their home. Top activities before buying a home include learning about mortgage options (93%), getting pre-approved (93%), calculating closing costs (88%) and speaking to a mortgage lender before shopping for a home (88%). However, land transfer tax, legal fees and closing costs were the top costs that buyers felt unprepared for (48%, 46% and 43% respectively).

About the TD Canada Trust Home Buyers Report:

Results for the TD Canada Trust Home Buyers Report were collected through a custom online survey conducted by Environics Research Group. A total of 1,000 completed surveys were collected between June 8-21, 2010, including 69 from Manitoba and Saskatchewan. All participants either purchased their first home within the past 24 months, or intend to purchase their first home within the next 24 months.

About TD Bank Financial Group

The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Financial Group. TD Bank Financial Group is the sixth largest bank in North America by branches and serves more than 18 million customers in four key businesses operating in a number of locations in key financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust and TD Insurance; Wealth Management, including TD Waterhouse and an investment in TD Ameritrade; U.S. Personal and Commercial Banking, including TD Bank, America's Most Convenient Bank; and Wholesale Banking, including TD Securities. TD Bank Financial Group also ranks among the world's leading online financial services firms, with more than 6 million online customers. TD Bank Financial Group had CDN$574 billion in assets on April 30, 2010. The Toronto-Dominion Bank trades under the symbol "TD" on the Toronto and New York Stock Exchanges.