Homebuyers Cut Vacations and Tap Retirement Savings as 78% Say Ownership Demands More Sacrifice

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Homeownership has always demanded patience, but for many Canadians the down payment is now being assembled from pieces of life they expected to keep: a summer trip, a replacement car, evenings not spent at a second job, and money once reserved for retirement. New RBC findings show that 78% of Canadians believe buying a home requires more sacrifice today than it did for previous generations.

The pressure is especially visible among those hoping to purchase within two years. Large majorities expect to delay major purchases, scale back vacations or rebuild their budgets, while more than half foresee redirecting retirement savings toward a home. The result is a market in which ownership remains emotionally powerful, yet the route to it increasingly tests whether households can reach the front door without weakening the rest of their financial lives.

Sacrifice Has Become the Price of Entry

The sense that today’s buyers face a steeper climb is not limited to people actively searching listings. RBC found that 78% of Canadians believe ownership now requires more sacrifice than it did for earlier generations, rising to 83% among those intending to buy within two years. Nearly three-quarters of all respondents also said most first-time buyers experience some degree of financial shock. Those numbers suggest the struggle is no longer viewed as a temporary inconvenience caused by one bad season. It has become part of the national understanding of what buying a home entails.

That perception is easier to understand when set against current prices. The national average sale price reached $702,079 in May 2026, the first time it had moved above $700,000 in 23 months. A buyer does not need to be purchasing at the national average to feel the strain. Even a less expensive property can demand years of saving, a large mortgage and a cash reserve for closing. For many households, the question is no longer simply whether they can qualify, but what must be surrendered to make qualification possible.

Vacations Are Turning Into Down-Payment Contributions

Travel is one of the clearest casualties of the homeownership push. Among Canadians intending to buy within two years, 62% said they would postpone or scale back vacations, up from 55% in January. Another 69% expected to delay major purchases such as a vehicle or renovation, a sharp increase from 54% earlier in the year. What once looked like discretionary spending is increasingly being treated as down-payment money that cannot be replaced once it leaves the account.

The trade-off can feel deeply personal. A couple may skip a long-planned trip, keep an aging car for another winter or turn a family celebration into a smaller gathering, not because those experiences lack value, but because the home goal keeps moving ahead of them. At the same time, everyday costs continue to compete for the same dollars. Canada’s Consumer Price Index rose 3.2% year over year in May 2026, while grocery prices increased 4.3% and transportation costs rose 9%. Saving for a home therefore requires cutting optional spending while essential expenses keep making their own claim on household income.

Buyers Are Rebuilding Their Entire Budgets

For many prospective buyers, a few cancelled dinners are no longer enough. RBC found that 60% of those planning to purchase within two years expect to completely overhaul their spending and saving habits, up from 55% in January. Another 57% believe they will need a side hustle or second job. Those figures point to a much broader adjustment: homeownership is shaping not just what households buy, but how much they work, how they use their evenings and how much flexibility remains in their monthly budget.

Inflation is making that reset harder. Seventy-one per cent of near-term buyers said it is causing them to save less for a home. That creates a frustrating loop: households cut spending to build a deposit, but higher prices absorb part of the money they hoped to set aside. A second income stream can accelerate the process, yet it also adds fatigue and uncertainty. The buyer may reach the target sooner, but only by accepting a schedule that would be difficult to sustain after mortgage payments, property taxes, repairs and other ownership costs begin.

Retirement Savings Are Being Pulled Into the Present

The most consequential sacrifice may be the decision to use money originally intended for later life. Among people expecting to buy within two years, 53% said they would put some retirement savings toward the purchase, up from 49% in January. That choice can make the difference between remaining a renter and assembling a workable down payment, but it also changes the purpose of money that had been set aside to compound over decades.

Federal programs are designed to make that transfer easier. The Home Buyers’ Plan currently allows an eligible person to withdraw up to $60,000 from an RRSP for a qualifying home, with the amount generally repaid over as many as 15 years. Eligible buyers can also use a First Home Savings Account, which provides $8,000 of participation room in the first year an account is opened and a $40,000 lifetime contribution limit. The two programs can be used for the same qualifying purchase. They offer valuable tax advantages, but they do not erase the underlying tension: every dollar redirected toward a home must still be considered alongside retirement security and future cash-flow needs.

The First Financial Shock Often Arrives at Closing

The purchase price is only the most visible number. RBC found that 74% of Canadians believe most buyers experience some level of financial shock when purchasing their first home. One reason is that the transaction brings expenses that are easy to underestimate while attention is fixed on the down payment and monthly mortgage. Legal fees, land transfer or registration charges, inspections, adjustments for prepaid taxes and moving costs can arrive in a compressed period.

CMHC advises buyers to plan for closing costs equal to roughly 1.5% to 4% of the selling price. Applied to the May 2026 national average price of $702,079, that range would equal approximately $10,500 to $28,100, separate from the down payment. The exact total varies by province, municipality and property, but the example shows why a buyer who uses every available dollar to complete the purchase can feel squeezed immediately afterward. A successful offer may bring relief and excitement, followed quickly by the realization that appliances fail, roofs age and emergency savings are harder to rebuild once the mortgage begins.

A Softer Market Does Not Automatically Mean an Affordable One

There are signs of opportunity, but they do not remove the pressure. Among Canadians intending to buy within two years, 45% said now is the right time to purchase, compared with 27% of Canadians overall. Fifty-eight per cent of near-term buyers believed lower prices would allow them to buy their first or next home, while 54% said the same about lower interest rates. That optimism helps explain why some households are willing to make aggressive sacrifices rather than wait.

Yet a market can become more balanced without becoming inexpensive. Nationally, Canadians were divided over conditions: 27% described a buyer’s market and 36% a seller’s market. Regional views differed sharply, with respondents in British Columbia and Ontario more likely to see buyer-friendly conditions, while majorities in Quebec and Atlantic Canada described a seller’s market. Those differences matter because “Canada’s housing market” is not one experience. A buyer with more negotiating room may still face a price that consumes most available savings, while someone in a tighter region may be sacrificing heavily just to compete.

The Fear of Missing the Window Adds New Pressure

Prospective buyers are not only calculating affordability; they are trying to predict whether today’s opportunity will disappear. Fifty-three per cent of those planning to buy within two years said there may be only a small window to benefit from lower prices, and 49% expected interest rates to rise during 2026. At the same time, 64% of Canadians said it is impossible to know the perfect time to buy. The result is a decision shaped by two competing fears: purchasing before the household is ready or waiting until conditions become worse.

Economic uncertainty intensifies that tension. Among near-term buyers, 72% called it their biggest challenge, 75% said it was making them more cautious and 67% worried it would affect their plans. This is where sacrifice can become especially risky. Cancelling a vacation is reversible; exhausting cash reserves or taking on a payment with no margin is not. A household under timing pressure may focus on winning the property rather than preserving room for job changes, rate movements, family needs or unexpected repairs.

The Strongest Purchase Plan Leaves Something Behind

Confidence remains surprisingly thin for a decision of this size. Fewer than half of prospective buyers said they feel confident making homebuying decisions in the current market, and only 56% believed they had the information needed to make smart choices. At the same time, 82% of prospective buyers and homeowners approaching renewal said expert advice is essential. The gap suggests that many Canadians are ready to act emotionally before they feel fully prepared financially.

Policy changes can improve access without eliminating trade-offs. Insured 30-year amortizations are available to all first-time buyers and purchasers of new builds, while the insured-mortgage price cap was raised to $1.5 million in December 2024. Longer repayment periods can reduce monthly payments, but buyers still need to evaluate the total commitment, closing costs and the resilience of their budget. The most sustainable version of homeownership is not necessarily the largest mortgage a household can obtain. It is the purchase that still leaves room for retirement contributions, emergencies, ordinary pleasures and a life that does not have to remain permanently on hold.

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