The dream of homeownership is strong among millennials
Nicole and Matt have two small children. Matt is a welder and Nicole works in a salon. Two years ago, while Nicole was pregnant with their second child, they decided it was time to start looking for a home.
They searched REALTOR.ca for their perfect starter home.They needed a few bedrooms, some space for the kids to play in the yard and, ideally, a garage for Matts welding side jobs. They called a REALTOR, spoke with a mortgage broker and made a decision.
Home ownership was not affordable for them at that time. They moved into Nicoles parents house. Not how you expected that story to end, is it?
Unfortunately, this is the reality that many millennials (born between 1981 and 1996) face in Canada today. In research released in October of 2018, conducted by Abacus Data on behalf of the Canadian Real Estate Association (CREA), housing ranked as the top priority for Canadian millennials.
In fact, 86 per cent of Canadian millennials who are not homeowners want to own a home someday and 68 per cent of those are passionate about it.
So whats stopping them? In the survey, millennials stated that saving enough for a down payment, the cost of carrying a home with monthly mortgage payments and mortgage interest rates were the top three factors that impacted their ability to enter the housing market. Saving a down payment was listed by 47 per cent of millennials as the top issue that affects their ability to buy a home.
Researchers also asked millennials what impact recent housing policy changes had on their decisions to enter the housing market. The results were shocking, with more than 60 per cent feeling that interest rate increases and government decisions that make it more difficult for people to get a mortgage have had a negative impact on housing affordability.
There is a clear desire from Canadian millennials to achieve the dream of homeownership. Most millennials want to own a home and will be looking to our elected leaders for progressive policies to make those homes affordable.
Recently, proposals from the Nova Scotia Association of REALTORS (NSAR), in conjunction with the Canadian Real Estate Association (CREA), have been implemented by the federal government to improve affordability. In March of 2019, the Home Buyers Plan (HBP) was increased to allow first-time buyers to borrow up to $35,000 from their RRSP towards a down payment.
But more can be done to provide meaningful assistance and allow more Canadians to enter the housing market. In the 2019 election, millennial voters will make up the largest portion of the electorate at 37 per cent. With such a large portion of voters identifying as millennials, housing affordability is expected to become a prominent election issue.
That idea sits well with Nicole and Matt, who are still living in her parents basement apartment looking forward to purchasing their first home sometime very soon.
- Contributed by NSAR
NSAR is the professional association for more than 1,500 REALTORS in Nova Scotia.
SCHL: Pénurie de logements au Canada : Estimation des besoins pour résoudre la crise de l’abordabilité du logement au Canada d’ici 2030
Nous traversons une crise du logement. Dans ce rapport, nous examinons labordabilit globale de lensemble du systme de logement au Canada. Nous avons pris des mesures pour estimer la quantit de logements supplmentaires ncessaires, au-del des tendances actuelles, pour rtablir labordabilit du logement dici 2030.
Nous prvoyons que si le taux actuel de construction se maintient, le parc de logements augmentera pour atteindre prs de 19 millions dunits dici 2030. Pour rtablir labordabilit, nous estimons que le Canada aura besoin de 3,5 millions de logements supplmentaires.
Les deux tiers des 3,5 millions de logements manquants se trouvent en Ontario et en Colombie-Britannique, o les marchs de lhabitation sont les moins abordables.
Des logements supplmentaires seraient galement requis au Qubec. Cette province tait autrefois considre comme abordable, mais labordabilit sy est fortement effrite au cours des dernires annes.
Dautres provinces demeurent largement abordables pour un mnage ayant un revenu disponible moyen. Cependant, il est toujours difficile pour les mnages faible revenu davoir accs un logement abordable partout au Canada.
Canada’s Housing Supply Shortages: Estimating what is needed to solve Canada’s housing affordability crisis by 2030
Were in a housing crisis. This report looks at the overall affordability for the entire housing system in Canada. The report has taken steps to estimate how much additional housing supply is required beyond current trends to restore housing affordability by 2030.
CMHC projects that if current rates of new construction continue, the housing stock will increase to close to 19 million housing units by 2030. To restore affordability, CMHC projects Canada will need an additional 3.5 million units.
Two-thirds of the 3.5 million housing unit gap is in Ontario and British Columbia where housing markets are least affordable.
Additional supply would also be needed in Quebec, a province once considered affordable. It has seen a marked decline in affordability over the last few years. Other provinces remain largely affordable for a household with the average level of disposable income. However, challenges remain for low-income households in accessing housing that is affordable across Canada.