More than three out of 10 Metro Vancouver residents aged 18-28 plan to enter the property market within five years, a new national survey reveals
Looking to buy a home in Metro Vancouver? Be warned that as of January, the MLS Home Price Index composite benchmark for the region stood at $1,255,200. To put things in perspective, that’s a year-over-year surge of 18.5 percent.
Financing the Future of Canadian Housing: Generation Z Trends Report is based on an online survey of about 1,500 Gen Z adults aged 18-28 in the Vancouver, Calgary, Montreal and Toronto census metropolitan areas.
The survey challenges the stereotype that younger people have little interest in home ownership. Among its highlights: one in three respondents expect to buy their first home within five years, while two thirds plan to rely on personal savings for their down payment. Perhaps surprisingly, almost 40 percent of respondents said they’d be most likely to buy a single-family home as their first residence.
“The influence of Generation Z is rising with each passing year, and their impact on Canada’s real estate market is set to be substantial,” Josh O’Neill, general manager of Vancouver-based Mustel Group, said in a release. “Results from this survey reveal the high level of confidence that young Canadians have in housing and demonstrate how they are overcoming financial barriers to attain home ownership.”
No kidding. In Vancouver, the poll found that members of Gen Z are confident about the local housing market’s future performance and see home ownership as vital to their financial and retirement plans. Among respondents from the region, 86 percent believe home ownership will play a major role in a financially stable retirement; 75 percent think a home purchase will perform the same as (28 percent) or better than (47 percent) financial investments.
Despite ever-increasing costs, 36 percent of Vancouver survey respondents expect to buy their first home within five years, while 43 percent anticipate doing so within five to 10. Along with their peers in Toronto, Vancouver respondents are more likely than the rest of the survey group to expect to pay dearly for their first home. Sixteen percent anticipate shelling out $750,000 to $999,999, while 14 percent think they will pay more than $1 million.
And like their counterparts in other cities, Vancouver’s Generation Z are a self-reliant bunch when it comes to saving for home ownership: 62 percent of local survey respondents said that personal savings would be their main source of funding for a down payment.
Their other options include a financial gift from family (31 percent), a non-mortgage loan from a financial institution (23 percent), sale of financial assets such as stocks and bonds (23 percent) or a family inheritance (21 percent).
To get into the housing market, what personal and financial steps are Gen Z residents of Vancouver prepared to take? For 49 percent, the plan is to land a full-time job with a higher salary, while 45 percent said they will get a second job.
Some other sacrifices: eliminate or reduce personal spending (39 percent); move in with family or curtail eating out (36 percent); live with friends and roommates (26 percent), reduce or eliminate entertainment, health, or fitness spending (26 percent); and reduce or eliminate vacations (25 percent).
For Vancouver’s Gen Z survey respondents, full ownership is the most likely option for buying their first home, with 39 percent favouring that route. Another 27 percent expect to co-own with family, while 13 percent think they will purchase a home with friends or other parties who aren’t family.
Did someone say parties?