A recent poll conducted by Ipsos Reid suggested that GTA households remain upbeat about purchasing a home in 2016. The recent sales in January and February certainly support this view. But, I don’t think it’s true of all demographics. With so few homes on the market and prices rising monthly, it’s become increasingly difficult for Millennials to afford the down payment required to purchase a home.
I found the following stats staggering…
In 1974, the typical 25-34 year-old had to work and save money for five years in order to afford a 20-percent down payment on the average Canadian home; in 2016, it takes twelve years. In Canada’s hottest housing markets it’s taking even longer. For example, it takes fifteen years in the Greater Toronto Area; sixteen in British Columbia; and Vancouverites need a staggering 23 years to come up with a down payment!
Paul Kershaw, a UBC professor and founder of “Generation Squeeze”, summarizes the problem in these words, “As younger Canadians finish school, begin careers, look for homes, and start families, they are squeezed by stagnant incomes, sky-high costs, less time and mounting debts and a deteriorating environment. No wonder saving for a down payment is difficult!”
Many millennials are wondering if they’ll ever be able to afford a condo, never mind a house. The answer is a yes, if they look in the outskirts and accept a commute as part of daily life. In exchange, they can enjoy a unique sense of community, more land and more money in the bank.
I have lots of ideas about exploring “the outskirts” for affordable housing. Call/email/text me and I’ll share my thoughts with you.
