Young Ontario residents giving up on home ownership: survey

·3-min read

Soaring home prices in Ontario, which are up between 30-50 per cent from last year depending on the area, are forcing a growing number of residents to give up on their dreams of home ownership.

A new survey by Right at Home Realty found 51 per cent of respondents say they believe they may never be able to afford a home in their current city or town. It gets worse for people looking in the Greater Toronto Area at 55 per cent and 59 per cent in the 416 area code region.

The picture gets even more grim for younger Ontarians aged 18 to 34, of whom 74 per cent say they may never be able to afford a home where they currently live.

The next two cohorts are slightly more optimistic, but still feel largely priced out. Among those aged 35-54, 47 per cent fear they'd never be able to buy where they currently live, compared to 37 per cent for those aged 55 and over.

Who can afford a home

The survey also found about half who are planning to buy in the next two to three years will use equity from their current home to buy their next home. And those buyers aren't worried about rising mortgage rates, with 70 per cent saying a move of 1.5 per cent or less would have no effect on their buying plans.

"Homeowners continue to see the value in home investment. Current low rates are making it easier for many homebuyers to consider getting on the property ladder," said John Lusink, president of Right at Home Realty, in a release.

"Our survey found that for two-thirds of Ontarians, the pandemic period has had no impact on their ability to save for a new home. However, for nearly a quarter of respondents, it has had a negative impact on their ability to save for a downpayment, slowing the prospect of a new home for a large contingent of the population."

Searching for more living space

Of respondents who plan to sell in the next two to three years, 39 per cent say they will be buying a bigger house. The desire for outdoor versus indoor space was about the same.

The survey also found other priorities brought on by the pandemic included being closer to nature (38 per cent), more privacy (33 per cent), and being closer to family and friends (30 per cent).

But the so-called urban exodus could be waning as vaccines roll out and plans are being made for a gradual reopening.

Only 18 per cent say they'd be willing to move to a smaller community to get that extra space, in large part because 42 per cent of respondents worry that moving away from a larger centre could hurt their opportunities for career growth.

But 25 per cent of sellers in the next 12 months say they would consider moving to a different neighbourhood in the same city. 

Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.

Download the Yahoo Finance app, available for Apple and Android.