A new poll finds that many Canadians are shying away from large purchases amid a “summer of sticker shock” that has seen interest rates rise and inflation send prices soaring for everyday items.

Three quarters of Canadians now say that it’s a bad time to make a major purchase, such as a home, car, or expensive vacation, according to the poll conducted by the Angus Reid Institute. Just 15 per cent said it was a good time and 10 per cent weren’t sure.

That represents a big jump from two years ago when 56 per cent that it was a bad time to make a major purchase and 29 per cent believed it was a good time.

Angus Reid Poll

While responses varied somewhat by household income, even most people (71 per cent) in households earning $200,000 a year or more said that it was a bad or very bad time to be making major purchases.

While consumer confidence is down across the country, the poll found that it was highest in Ontario and British Columbia, where respectively 17 per cent and 18 per cent of respondents said they expect the next 12 months to be a good time to make a major purchase. That compares to eight per cent in Saskatchewan and 11 per cent in Atlantic Canada.

Inflation is hovering at around eight per cent, way up from the central bank’s target of two percent.

Canadians have seen food and energy prices soar amid supply shortages and war in Ukraine. Rising borrowing costs have also cooled previously red-hot real estate markets, with the average cost of a home in the GTA falling for four consecutive months.

real estate home sales mortgage

Data from Statistics Canada also show that car sales for March, April and May are down around 18 per cent compared to the same period last year.

Some 28 per cent of Canadians now describe their personal financial situation as being in bad or terrible shape, while 72 per cent say it is in good or great shape. That compares to 20 per cent who said their financial situation was bad or terrible in July 2020 and 80 per cent who said it was good or great that same year. 

New cars

Quebec (77 per cent) and Ontario (73 per cent) lead in respondents who describe their situation as good or great, while Manitoba (60 per cent), Saskatchewan and Atlantic Canada (each at 64 per cent) lag.

The poll also found that most Canadians (71 per cent) are watching the Bank of Canada’s rate hikes closely or very closely as the country navigates a period of financial uncertainty. For comparison, another recent poll by Angus Reid found that 56 per cent of Canadians say they are watching the war in Ukraine closely.

The bank has been matching runaway inflation with some of the most aggressive rate hikes seen since the early 90s.

Tiff Macklem

Just 33 per cent of Canadians are confident or very confident that the Bank of Canada is making the right decisions, the poll found.

The issue has been politicized recently in the Conservative leadership race, with one candidate saying he would fire BOC governor Tiff Macklem.

Just 26 per cent of those who voted for the Conservative Party in the last federal election said they had confidence the bank is making the right decisions, while 34 per cent of those who voted NDP were confident. Confidence was highest among those who voted Bloc Quebecois (53 per cent) and Liberal (47 per cent).

The online poll surveyed 1,606 random Canadians who are members of the Angus Reid Forum. Margins of error are not available for online surveys, but a probability sample of a similar size would carry a margin of error of plus or minus two percentage points, 19 times out of 20.