Of the 35 per cent of boomers who say they are considering purchasing a primary residence in the next five years, 56 per cent say they would consider moving to a rural or recreational region.
According to a recent Royal LePage survey of boomers in Canada, defined by StatsCan as having been born between 1946 and 1965, 35 per cent of the cohort — or approximately 3.2 million boomers — said they are considering a home purchase within the next five years. Nationally, 45 per cent of respondents believe now is a good time to sell their home.
“The boomer generation appears to have no intention of slowing down,” said Phil Soper, President and CEO, Royal LePage. “Fully vaccinated, and turning a cold shoulder to retirement, the typical member of this huge demographic is enjoying an empty nest and believes real estate is a good investment. Millions of boomers are expected to wade into the market over the next five years.”https://f08c8797c1fb2d90e68b63b7ed15ae50.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
Boomer Housing Demand
There is no one-size-fits-all outcome as Canadian boomers age into retirement, especially when it comes to their decision about where to live. More than half (57%) of respondents said they would purchase a detached house if they were to buy, while 19 per cent said they would prefer an apartment/condominium. Fifty-two per cent of boomer homeowners said they would prefer to renovate their existing home rather than purchase another, and an additional 24 per cent said they would consider it.
Of the 35 per cent of boomers who say they are considering purchasing a primary residence in the next five years, 56 per cent say they would consider moving to a rural or recreational region. Twenty-eight per cent say they would consider purchasing a larger home than the one they currently reside in, 56 per cent would consider a similarly-sized property, and 63 per cent would consider downsizing. Respondents were able to choose more than one option. The most popular reason for downsizing is less home maintenance (71%). Other popular choices include the ability to free up money for things like retirement (39%), travel (29%), and to help their children purchase a home (9%).
“Turning full circle to those carefree, pre-children years, most boomers are looking for a home that requires less maintenance,” Soper continued. “Paradoxically, they also yearn for country living and don’t want to sacrifice living space. Look for the continued growth of managed communities in exurban and recreational regions.”
Working boomers largely did not consider their region affordable (65%) and 42 per cent said they would consider a move to a different city, near or during retirement.https://f08c8797c1fb2d90e68b63b7ed15ae50.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
Since the onset of the COVID-19 pandemic, more than 550,000 Canadian boomers (6%) have sold their homes or are in the process of selling, and at least 90 per cent said the global health crisis neither caused their plans of moving to be postponed nor expedited.
Homeownership and Personal Wealth
Seventy-five per cent of boomers own their own home, the majority of whom do not currently have a mortgage (64%). Seventeen per cent of boomer homeowners own more than one property, and 40 per cent have at least 50 per cent of their net wealth in real estate.
“The boomer generation strongly values home ownership, for good reason. Real estate has been very, very good to them,” said Soper. “Most are still working and their home equity has become the bedrock of retirement security. Financially confident, their next move is a matter of lifestyle choice.”
Seventy-eight per cent of Canadian boomers believe that home ownership is a good investment.
Boomers keep ‘bank of mom and dad’ open
As home prices continue to grow across the country, many young adults are turning to their boomer parents for help with a down payment on a property. Twenty-five per cent of boomers say they have or would consider gifting or loaning money to a child to help with the purchase of a home. In Vancouver, that figure reaches as high as 34 per cent.
“Over the past year, home values have appreciated sharply in virtually every market from coast to coast. Affordability is a major issue for young Canadians and with stricter mortgage stress test measures in place, they must clear higher hurdles,” Soper said. “Many are turning to the so-called ‘bank of mom and dad’ to achieve the dream of home ownership. The parental bank appears willing, even if it means delaying retirement.”https://f08c8797c1fb2d90e68b63b7ed15ae50.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
A recent Royal LePage and Sagen survey of first-time homebuyers in Canada found that 62 per cent of respondents nationwide felt anxious about missing out on a property they wanted because of an insufficient down payment, before buying their first home. That figure increased to 75 per cent in Toronto and 69 per cent in Vancouver.
Seventy-nine per cent of Canadian boomers do not have children living in their home. This includes boomers who are not parents. Seventeen per cent of them have adult children living at home. Seven per cent of those surveyed said they have children aged 18 to 24, and 12 per cent said they have children 25 years of age or older living at home.
Of those who have children living at home, 43 per cent plan to stay in their current property once their kids have moved out. Meanwhile, 21 per cent said they do not foresee their children leaving.
By the end of this decade, all boomers will be 65 or older, which typically coincides with retirement in Canada. Twenty-seven per cent of boomers who are currently working said they would consider delaying retirement to help their children with a down payment on a home.
Twenty-nine per cent of boomers in Quebec are considering purchasing a home within the next five years, which is among the lowest rates in Canada. At 62 per cent, Montreal has the lowest rate of home ownership among boomers. That figure rises to 67 per cent in the province, the majority of whom do not currently have a mortgage (57%). Sixteen per cent of boomer homeowners in Quebec own more than one property, and 34 per cent have at least 50 per cent of their net wealth in real estate.https://f08c8797c1fb2d90e68b63b7ed15ae50.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
More than half (53%) of respondents in Quebec said they would purchase a detached house if they were to buy, while 20 per cent said they would prefer an apartment/condominium.
Of the 29 per cent of boomers in Quebec who are considering purchasing a primary residence in the next five years, 62 per cent say they would consider moving to a rural or recreational region. Thirty-two per cent say they would consider purchasing a larger home than the one they currently reside in, 53 per cent would consider a similarly-sized property, and 59 per cent would consider downsizing (55% in Montreal). Respondents were able to choose more than one answer. The most popular reason among Quebec boomers for downsizing is less home maintenance (72%). Other popular choices include the ability to free up money for things like retirement (36%), travel (21%), and to help their children purchase a home (13%). Montreal respondents who are considering to downsize also value the ability to free up money for retirement (41%), travel (21%), and to help their children purchase a home (15%).
“While the expectation may have been that boomers would downsize into condominiums en masse, the proportion of Quebec boomers looking to move into a larger property is among the highest in Canada,” said Georges Gaucher, broker and owner, Royal LePage Village. “Although prices continue to rise in the Belle Province, it remains one of the most affordable markets in the country.”
Twenty-four per cent of respondents in Quebec are likely to assist a child financially with the purchase of a home.https://f08c8797c1fb2d90e68b63b7ed15ae50.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
Sixty-two per cent of boomer homeowners in Quebec said they would prefer to renovate their existing home rather than purchase another, among the highest rates of all the regions surveyed. An additional 21 per cent said they would consider it.
“We expect that as COVID-19 safety restrictions continue to be lifted and as the vaccination campaign progresses, some Quebec boomers will put their homes on the market, which will improve inventory selection for potential buyers,” added Gaucher. “However, while the variety of listings will improve, boomers who are selling are also expected to purchase. This will add more competition to the market.”
An online survey of 2000 Canadian boomers was completed between June 9, 2021 and June 14, 2021, using Leger’s online panel
— Royal LePage Real Estate Services