Are their expectations realistic in today's overheated market?
Ask any mortgage broker what Canadians want in a home and you’re likely to hear the same answer again and again: Space.
While COVID-19 has indeed sent home-hunters into the wilds in search of more square footage, new data from real estate listing portal Zolo.ca has found that prospective homeowners have more on their minds.
Zolo’s 2021 Home Buyers Survey, based on the responses of 1,369 home shoppers, found that a general desire for space does not, for most, top their list of priorities. According to the survey, the top four features home buyers want are a main floor bathroom, preferred by 71% of respondents, a garage (70%), a master bedroom with an en-suite bathroom (68%), and private outdoor space (68%).
“It’s not that these features didn’t rank high in a buyer’s preference list in prior years, but greater privacy and access to safe outdoor space appear to have taken on a higher level of importance among those shopping for property,” Zolo’s director of content, Romana King, wrote in the report.
An overwhelming majority of respondents, 73%, said the most important feature of their ideal home would be for it to be a detached property. The second- and third-most popular features were both bathroom-related: 49% of home shoppers want two bathrooms, while 40% want three.
With wage growth in Canada largely stagnant and home prices skyrocketing, one wonders if it’s entirely realistic for homebuyers to expect that the spacious, toilet-filled homes they’re dreaming of actually fit their budgets. While more house will undoubtedly require more money, more space, King feels, may be a different calculation.
“I think that when we talk about space, what we immediately assume is that we want a bigger house. What people are realizing is that it’s not necessarily a bigger house they want, but a well-appointed house where the space is better used,” she said.
As an example, King explained that for a homeowner to have an office, she doesn’t necessarily need a 500-square foot room with a locking door. A walk-in closet can function just as well, as many Canadians discovered after being sent flying into the remote work revolution in 2020.
King said the idea of converting space to better use explains a data point MBN found particularly surprising: that one of the amenities deemed “not important” by 42% of survey respondents is an additional suite, which can be a valuable revenue generator for homeowners in need of an income boost.
But a TV-fuelled reno craze, coupled with the fact that many Canadians are forced by budget constraints to purchase properties in need of updates, has meant that formerly coveted commodities like hardwood floors, new kitchens, and secondary suites are now seen as projects to be completed independently rather than amenities worth paying for.
“We no longer fear that work, and, as a result, we no longer fear the idea of adding an income suite,” King said, adding that many buyers now look for “income suite potential” in their property descriptions rather than income suites themselves.
But “potential”, she noted, is a subjective term.
“There are homes that definitely have suite potential that are not listed as such, and there are homes that are listed that way and you’re like, ‘Wow. It’s going to take a big bucket of money to make this an income suite,’” she said.
In breaking its survey data down by gender, Zolo found that both men and women have the same general desire – for a property to meet their overall work/live/play needs – but there were subtle differences between the sexes.
“For women, their primary concern is the comfort of the home and the stability of that comfort,” King said, “so that’s why, quite surprisingly, women actually wanted an updated HVAC system – furnace, central AC system – so they could know that the comfort of their home, their workplace and their play space is consistent.”
Men, she said, opted for energy-saving appliances as a way of cutting costs at a time when more family members are likely to be at home increasing a household’s utility bills.
Why this matters for brokers
Because mortgage brokers are often some of the first real estate professionals to hear a prospective homebuyer’s want-list, King said it is important that brokers understand the emotional reasons why people want certain properties.
“If you have someone buying a home at a price point that’s beyond their reach, but what’s really driving their desire for this detached home are these other, emotional factors. You can actually speak to them about the privacy and space in a townhouse that might not carry the same cost,” she said. “A mortgage broker can help guide those conversations.”
While buyers have access to more decision-shaping data than ever and may feel unreasonably confident in determining the amount of house they can afford, King said it’s still up to experts like brokers to give them the full picture.
“The more brokers can help provide context to buyers, the more those people are going to want to work with those brokers – and therefore refer them – because they really understand how much value was brought to their transactions,” she said.
