- Nearly two-in-five Canadians believe that Canada is currently in a recession.
- Despite economic uncertainty, more Canadians in Q1 2024 feel that they are in a better financial position than they were a year ago compared to Q4 2023.
- More Canadians are planning to wait until interest rates drop to buy or sell a house or property compared to Q4 2023.
- Only a quarter of Canadians feel comfortable with skilled professionals utilizing AI to support their services – but say education is key to acceptance.
TORONTO, April 4, 2024: Canadians are still feeling the looming specter of a potential recession and the burden of high interest rates on their everyday spending habits. However, a growing number say they feel they are in a better financial position compared to a year ago.
According to the Dye & Durham Canadian Pulse Report for Q1 2024, which surveyed 1,015 Canadians on economic, technological, and real estate trends via the online Angus Reid Forum, continued delays in rate cuts have led to more than a quarter of Canadians expressing intentions to wait for better borrowing conditions to drop before engaging in real estate transactions. However, anticipated interest rate cuts in the coming months, coupled with Canadians’ optimism regarding their financial situations, suggests that activity in the real estate market is poised to grow quickly once rates start to decline.
Canadians’ confidence in the economic outlook for 2024 has grown increasingly divided
Nearly four-in-ten (39%) Canadians say they believe Canada is already in a recession, up from 31% in Q4 2023 and 32% in Q3 2023. However, there is also a notable increase in optimism about the short-term strength of the economy with 20% of respondents believing that Canada will avoid a recession completely – up significantly from only 9% in Q4 2023.
Despite ongoing recession concerns, Canadians are feeling less pessimistic about their personal finances compared to Q4 2023. A growing number of Canadians (28%, up from 20%), particularly among younger respondents aged 18-34 (36%), feel that they are in a better financial position than they were a year ago while a decreasing number of Canadians (39%, down from 44%) hold the opposite view. However, high interest rates continue to significantly impact Canadians’ spending, spanning from daily expenses to retirement planning. Respondents anticipate increasing their spending in all surveyed categories compared to Q3 2023, including groceries (87%), gas (78%), insurance (auto, 69%; home, 70%; health, 53%), rent (58%) and retirement savings (36%) next year compared to the past year.
“Canadians are growing more optimistic about their financial horizons, laying a strong foundation for future economic growth and upswings,” says Martha Vallance, Chief Operating Officer, Dye & Durham. “Many are eagerly awaiting lower rates to jump back into the housing market, and it’s clear that the expected interest rate cuts in the latter half of 2024 will bolster the pent-up demand for housing. This surge in activity could result in a slower spring real estate market that quickly ramps up in the second half of 2024, resulting in a rebound of activity for relevant professionals like lawyers and realtors.”
Anticipated rate cut catalyst for real estate revival
In Q1 2024, the number of Canadians planning to wait until interest rates drop to buy or sell a house or property increased to 26%, up from 21% in Q4 2023. At the same time, the percentage of Canadians planning to sell their primary residence and purchase a new one remained steady at 12% while those looking to purchase their first home in the coming year gradually fell from 8% in Q3 & Q4 2023to 7% in Q1 2024. With the general anticipation in the market of a potential rate cut in mid-2024, Canadians are primed to seize opportunities in the real estate market when interest rates decrease.
Canadians’ perceptions remain consistent on the overall home affordability with 87% feeling it is less affordable than a year ago, aligning with the findings from Q3 2023. Despite this overarching belief, Canadians’ willingness to relocate for more affordable housing remains stable with approximately half (53%) of respondents indicating they would consider moving to a different city, province or country for this purpose, up from 50% in Q3 2023.
Canadians growing comfortable with Generative AI but need better understanding of use by skilled service providers
The use of Generative AI tools among Canadians continues to grow, with nearly half (45%) experimenting with tools like ChatGPT and others for personal reasons, and one-third (33%) for professional purposes. Additionally, 39% say they have used these tools for both personal and professional needs. This marks a notable increase compared to the figures of 36%, 24% and 27%, respectively, recorded in Q3 2023 – an increase of approximately 10% across different use cases. However, the frequency of use remains relatively stable with only a slight (one to four percent) increase in respondents using Generative AI tools on monthly, weekly or daily basis since Q3 2023.
Even with growing personal experimentation with AI, Canadians say they remain cautious about skilled service providers incorporating AI into the services they provide them. A significant portion of respondents expressed discomfort with professionals across sectors, such as doctors (62%), lawyers (61%), mortgage brokers (51%), and insurance brokers (52%), utilizing AI to support their services.
“Canadians are getting much more hands-on exposure to AI, but they are still at an early stage of the learning curve with a heightened skepticism of AI use when things matter most,” says David Nash, Chief Product Officer, Dye & Durham. “As legal professionals consider how AI can improve their day-to-day services while staying on the right side of regulations, clear communication and transparent education are paramount in helping clients feel comfortable with the benefits that AI can offer in their services.”
A better understanding of exactly how AI is being used is key in helping the average Canadian become more comfortable with skilled professionals like lawyers and notaries adopting these tools. Three-in-ten (29%) respondents say they would be more comfortable knowing that AI is being used to support the legal professionals without completely replacing them, while 28% expressed increased comfort if such integration significantly lowers costs. Guaranteeing better outcomes/accuracy (26%), having the ability to opt-in or opt-out of AI being used in delivering their service (25%) and if the use of AI was clearly explained ahead of time (25%) were other significant factors that would increase their comfort level.
About the Survey
Conducted quarterly, the Dye & Durham Canadian Pulse Report is designed to uncover trends and insights into Canadian sentiment surrounding three key areas: the economy, technology and the real estate market. The findings of the report are the result of a survey conducted by Dye & Durham from February 28-March 3, 2024 among a nationally representative sample of n=1,015 Canadians who are members of the online Angus Reid Forum, balanced and weighted on age, gender, region and education. For comparison purposes only, a probability sample of this size has an estimated margin of error of +/- 3.1 percentage points, 19 times out of 20. The survey was offered in both English and French.
Download the full report here.
About Dye & Durham Limited
Dye & Durham Limited provides premier practice management solutions empowering legal professionals every day, delivers vital data insights to support critical corporate transactions and enables the essential payments infrastructure trusted by government and financial institutions. The company has operations in Canada, the United Kingdom, Ireland, Australia, and South Africa. Additional information can be found at www.dyedurham.com.
For more information:
Matt Roth
Vice President, Global Brand and Communications
P: 647-518-6754
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