74% of Ontarians 18-34 don’t think they can buy home: survey

A survey of Ontarians revealed that three-quarters of respondents aged 18-34 don’t believe they will be able to afford a home in their city or town.

“Having worked in this industry for 35 years now, I have seen one group [among the aforementioned cohort] able to get into the market, and that’s thanks to assistance from parents who are able to do it, and certainly low-interest rates don’t hurt, but you do have to have a good job,” said John Lusink, president of Right at Home Realty, which conducted the survey with Maru/Blue. “It’s challenging all around. If it’s their first time purchasing, and with mortgage qualification rules tightening up yet again, it is discouraging and tough for young folks, so I empathize greatly with them.”

The anxiety isn’t just felt by buyers aged 18-34, says Erica Mary Smith, broker of record at Stomp Realty in Toronto.

“Every time I talk to my older clientele who have kids, the first thing they always say is, ‘I don’t know how my kids will ever afford a home,’” she said. “Now I’m seeing a lot of gift money from parents, and parents are transferring existing homes, namely condos into their kids’ names so that they’ll automatically be in the market at some point and they won’t have to deal with taxes. There’s a lot of parental help right now.”

Asked if easing mortgage qualification rules, including rescinding the 200 basis point stress altogether, for younger buyers might help them get a foothold in the housing market, Lusink noted that the rules exist for a reason, and as a parent himself he’s glad they do.

“As a parent, I’d be concerned about seeing my kids get into mortgages that are in the $600,000-800,000 range if they didn’t have the jobs and incomes to support that,” he said. “I am in favour of having stricter rules in place so these guys don’t get into trouble.”

Right at Home Realty and Maru/Blue’s survey also found that 47% of respondents aged 35-54, and 37% over 55, did not believe they could buy homes where they live.

Additionally, 42% said moving away from larger cities could hurt their career advancement while a majority working from home weren’t willing to move further away in case they’re called back to the office post-pandemic.

Eighteen percent of Ontarians would consider selling their homes to move to a smaller community, which Lusink says is evidence that the exodus from major cities in 2020 may have been media hype.

“While the pandemic necessitated working from home, what it has done is increase people’s desires for bigger space, some backyard space, but I think that because only 18% would move out of the city to smaller space means it’s not an exodus, as has been put forward in the media.”