Down payment costs are blocking nearly 1/3 of the city's young tenants
Compared to last year, fewer renters in Vancouver are planning to move on towards home ownership, according to the Altus Group’s Vancouver Flash Report 2018.
When asked if they are intending to buy a home any time next year, only 11% of current renters responded with “yes”. This proportion is markedly lower than the 17% during summer 2017.
“While homebuying intentions are up among current home buyers [14% in 2017 to 19% this year], this has been offset by weaker intentions among current renters – the latter being the primary pool for potential first-time buyers. Affordability remains a challenge for first-time buyers in the Vancouver market,” the study noted.
Almost one-thirds (32%) of young renters said that they are still saving for their down payments, which is why they do not have their own home yet. Meanwhile, 11% admitted that they feel they are unable to qualify for mortgages under the current regulatory regime, and another 11% stated that they are waiting for prices to decline.
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Nearly 30% of respondents in the Altus study also said that everything else (including prices) being equal, Vancouver’s young renters would rather live in a single-family home in the suburbs rather than in a downtown rental apartment / condo unit.
These results dovetailed with an earlier study by Sotheby’s International Realty Canada, which found that a vast majority (83%) of young Canadians would choose to raise their families in detached homes over any other housing type if costs are not an issue. Condos were the preferred choice of only 5% of respondents.
“The popular perception is that people in modern families have typically preferred multi-unit and city centre locations, when in fact what the report shows is if price were no object, they would prefer single family homes,” Sotheby’s International Realty Canada president and CEO Brad Henderson said.
“What the data is telling us that it's becoming harder and harder to achieve that objective,” he added. “The price of housing has gone up faster than wages so the dream of detached home ownership is becoming more difficult.”
