There is a housing shortage supply, according to one real estate veteran, and until that issue is addressed landlords are more important than ever.
Millennials are having a tough time affording homes, and that can be addressed by tackling a housing supply issue, according to Phil Soper, president of Royal LePage.
“We’re going to continue to have more people that need housing than we have housing unless there is a concerted effort … to provide adequate supply,” Soper told CREW. “Incentives, cutting red tape, all things that have been talked about and committed to in Ontario, I think it has to be a national commitment.
“I think because there is such a will, there will be a way. I think the market will respond and builders will build condo homes that satisfy the demand. There will be product and there is product in the GTA that hits that magic $350,000 price. Even in Toronto you can get into the market and I think people will. The magic is getting in and leveraging your capital appreciation in the property into your family-sized home.”
Until the government gets its act together and properly addresses supply, many millennials will be forced to rent.
According to Royal LePage’s most recent report, 49% of peak millennials believe the federal government’s mortgage regulations have impacted affordability.
As a result, they have been forced to consider lower-priced homes.
“When looking for a home, 53% of peak millennial purchasers across Canada are willing to spend up to $350,000, which would typically buy them a 2.5 bedroom, 1.5 bathroom property nationwide, with 1,272 square feet of living space,” the report reads. “Yet, with 58% of respondents having a annual household income of less than $69,000, and only 34% currently tracking to have a sufficient down payment of over 20 % to qualify for a mortgage in this price range, the actual logistics of homeownership can be quite difficult.”
The study also found 61% of millennials prefer to buy a detached home but only 36% believe that wish is realistic.
“In addition to high home values, peak millennials also face increasingly stringent mortgage stress test regulations, which push potential buyers to the sidelines, electing to either remain in the rental market to save up enough money for a down payment, or move to more affordable regions,” the report reads.
“When asked, 64% of peak millennials currently believe that homes in their area are unaffordable, with a significant proportion of respondents in both British Columbia (83%) and Ontario (72%) asserting that prices are simply too high. Of those that do not believe they will be able to own a home in the next five years, 69% stated that they cannot afford a home in their region or the type of home they want, while roughly a quarter (24%) are unable to qualify for a mortgage.”
CREW
We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.
Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!
No comments:
Post a Comment