This demographic is likely to account for nearly 700,000 home sales over the next five years
At present, newcomers to Canada account for around 21% of home purchases nationwide, according to a new report by Royal LePage.
The analysis defined newcomers as those who have moved to Canada within the last 10 years. This category covered immigrants, refugees, foreign students, and those who are here for work. On average, the study’s respondents stayed in Canada for around four years.
Recent StatsCan data indicated that inbound migration comprised 80.5% of Canada’s population growth last year. At this current trend, newcomers are likely to be responsible for 680,000 home sales over the next five years, Royal LePage predicted.
“In addition to supporting Canada’s economic growth, newcomers to Canada are vital to the health of our national real estate market,” Royal LePage president and CEO Phil Soper said. “Canada’s economy and labour markets are expanding and it is crucial that housing supply keeps pace.”
“It is not surprising that newcomers see a home in Canada as a good investment,” he added. “Newcomers are doing more than investing in Canadian real estate; they are investing in their family’s future.”
The added market load that these buyers represent, while beneficial for industry players, is a potential threat that governments at all levels should address as early as now.
“The combined demand for affordable housing among younger Canadians and new Canadians can be met through housing policies that encourage smart and sustainable development, with a focus on protecting and developing green spaces in our urban centres,” Soper argued.
Fully 82% of newcomers remained in the region where they first got their homes. Among those who moved to elsewhere in Canada, 41% stated that better employment opportunities were their reason for relocating, while 12% cited better housing affordability.
However, despite sustained appetite on the newcomers’ part, the homeownership rate of this buyer class is only 32%. To compare, the homeownership rate for all Canadians is 68%.
