Nearly 20% of GTA Homeowners Under 35 Own More Than One Property
In Canada’s three largest urban centres, more than one in ten homeowners owns multiple properties, according to a new survey on secondary properties from Royal LePage.
The survey, released Wednesday, found that of Greater Toronto Area (GTA) homeowners, 13% own more than one property. However, that number rose to 18% for homeowners aged 18 to 35, compared to 11% of homeowners over the age of 35.
While entering the Toronto area housing market is challenging, especially for millennials, as low inventory continues to drive prices higher, of the GTA residents who own more than one property, 42% said they were able to use equity from their primary residence to purchase the second home.
What’s more, nearly half of Canadians between the ages of 25 and 35 now own their home and a quarter of these young homeowners say they were able to purchase property since the onset of the pandemic, according to Royal LePage.
Of the homeowners with secondary properties, 64% say they rent out their second home, with 49% saying they rent out their secondary properties full-time and collect rental income and the other 15% saying they rent them part-time. Some 7% leave their secondary properties empty.
“While some secondary properties are used for recreational purposes, many of these homes are foundational to Canada’s critical supply of rental housing,” said Phil Soper, president and CEO, Royal LePage.
Soper says that by investing in real estate, these homeowners have added to the region’s rental supply.
“Entrepreneurial landlords supply housing to the 30% of Canadians who rent, be they new immigrants, students, young people entering the labour force, or those who cannot or choose not to own their home,” said Soper.
However, John Pasalis, president of Realosophy Real Estate, says that for Toronto to truly be affordable for renters and buyers, the city needs more of its rental stock to be supplied by purpose-built rentals.
While housing prices continue to rise across the country, and many young buyers continue to be priced out of the market, 29% of ‘boomers‘ — those born between 1946 and 1965 — say they have or would consider gifting or loaning money to their children to help them purchase a home.
Of the Toronto millennials considering buying a home, Royal LePage says 93% of them believe homeownership is a good financial investment.
“Young buyers are looking to capitalize on the real estate market by investing in a property that will appreciate over time,” said Karen Millar, sales representative, Royal LePage Signature Realty.
“I have many younger clients who have purchased condos or smaller homes for as little as $300,000 outside of Toronto, in areas like Guelph and London, where the rental market is very active among students,” said Millar.
Millar added that parents of students living in Ontario’s university towns are also more regularly taking advantage of the local rental market by purchasing a property — often with multiple units — for their children to live in while studying and also as a source of rental income from other students.
With the borders set to reopen and international students gearing up to return, the Toronto area’s rental market is poised for a major comeback in the fall.