Despite the rocky real estate climate, many Canadians still have their sights set on homeownership.
At a time when the cost of homeownership in many urban centres is out of reach for those without familial help, owning a home is still a priority (even if also a pipe dream) for 67% of Canadians, according to new research.
Personal finance company NerdWallet teamed up with The Harris Poll to survey 1,012 Canadian adults aged 18 and older on whether homeownership was in their future.
Almost half (43%) stated that they are looking to buy a property within the next five years, though just 5% say they plan to purchase said home within the next year, a period when interest rates are expected to remain restrictively high.
Despite the optimism, the reality remains that we're in an era of both sky-high interest rates and home prices. The (slightly head-scratching) reality also remains that, of those surveyed who planned to purchase a home in the next five years, 24% said they haven’t started saving for it yet. Despite this, 76% of Canadians who plan to buy a home in the next five years plan to use a down payment.
Presumably, that’s where parents and or family members will come into play. The absence of this -- and a sufficient down payment -- will prevent millions of Canadians from becoming homeowners, cautions the report.
The age group most eager to become homeowners within the next three years are those aged 18 to 34 (37%), followed by those aged 35 to 44 (36%).
Whether their dreams of homeownership materialize or not, 34% of those surveyed said they wanted to buy a home because they think it’s a good investment. Meanwhile, 20% of respondents said they wanted to pass it down to their future children while 19% say it’s because they want their monthly housing payments to go toward equity rather than rent. Other not-so-surprising reasons for wanting to buy a home included a desire for more space and planning for the future.
As it turns out, non-homeowners and homeowners share many of the same challenges. As the report highlights, homeowners can sometimes have an advantage over non-homeowners when buying homes, but a majority of both groups -- 70% of non-homeowners and 57% of homeowners -- say something, including things like market forces or financial challenges, is preventing them from pursuing homeownership at this time.
Well, at least they know they're not alone.