A recent article from Canadian Mortgage Trends found that 8 in 10 millennials will purchase a home within the next 5 years. Currently, roughly 34% of the Canadian housing market is made up of millennial homeowners.
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With home prices climbing at near-record paces, how are these millennials planning to buy?
According to the article, 70% of those who said they are planning to buy within the next half-decade don’t have enough money for a down payment.
Parents to the rescue!
It is anticipated that 37% of these potential buyers will seek financial aid from their parents when it comes to a down payment on a home. Although the option for financial support is present, the new mortgage rules that the Canadian government introduced late in 2016 will surely make it even more difficult for young buyers to enter the market.
In October of last year, the government brought in stricter rules to try and cool down the number of people entering the housing market who are committing to mortgages in which are too expensive for their own self.
To help save enough money to qualify for a mortgage, more than half of the millennials surveyed said that they would be willing to decrease the amount they spend on “fun” activities, such as going out on the weekends. Approximately 1/3 of millennials also said that they would settle for a smaller, less-than-perfect home and delay having children.
With millennials the future of our world, the real estate market is heavily relying on them to keep it hot. Imagine what would happen to the market if millennials decided not to buy; we would see home prices drastically decrease and supply severely outweigh demand, something that would be a nightmare for homeowners.
Thankfully, millennials are at the age where they are seriously considering purchasing homes and starting families.
If you’re looking to buy a home and want the lowest mortgage rates Oakville, contact our team today and learn how we can help!