Millennials especially benefited from low rates, reduced competition, and mounting savings
The COVID-19 pandemic paved a path to home ownership for young Canadians, with approximately 25% of owners in the 25-35 age range saying that they purchased their homes during the health crisis, according to a new Royal LePage survey.
Among millennials without homes, 84% said that they have a “strong intention” to purchase in the future, with 68% planning to do so in the next five years. Another 39% said that they are looking to buy in two to five years, while 14% intend to do so within one to two years and 16% within this year.
The poll also found that for 52% of young Canadians, remote working arrangements have increased the likelihood of them relocating to communities situated further from their workplaces.
Phil Soper, president and CEO of Royal LePage, said that historically low mortgage rates and much-reduced competition for entry-level housing were the main contributors to these trends.
“Many investors sought to divest of property as traditional renter groups such as foreign students, new immigrants and short-term renters disappeared behind closed borders,” Soper said. “Measures necessary to prevent the spread of COVID-19 have motivated many of our younger Canadians to buy, while the health crisis dissuaded many of our older homeowners from selling.”
Significantly improved purchasing power also unlocked the doors to ownership. While the pandemic’s upheaval has made many young Canadians’ social activities and outlets untenable, “the silver lining is in soaring savings; unspent money that is finding its way into real estate investments,” Soper said.
Approximately 40% of Royal Lepage’s respondents aged 25-35 said that their savings grew since March 2020, while 72% expressed confidence in their financial outlook for this year.
