The 2017 Zoocasa housing sentiments and trends report

Poll shows homeownership still a desirable milestone

By: Sheila O’Hearn, Zoocasa

Despite real estate affordability and supply challenges that have dominated the conversation around Canadian home ownership, the 2017 Zoocasa Housing Trends and Sentiments Report reveals that those surveyed still consider home ownership or property investment as an important and achievable aspiration, whether as first-time buyers, move-up buyers, or downsizers.

The report was created from an online survey of more than 1,100 Canadians from February 2017 to March 2017. It provides insights into perceived obstacles to ownership and stress factors when purchasing a home. The report also gathered information from the Canadian Real Estate Association (CREA).

Household income of investors

Not surprisingly, those in higher-income households are more likely to own investment homes, as increased cash flow is generally needed to qualify for additional mortgages and finance a down-payment, especially since the financial barrier to enter the market has increased in Canada’s urban centres, especially in the Vancouver and Toronto real estate markets.

Survey respondents who own investment property by household income illustrated the following:

4 per cent less than $20,000
4 per cent $20,000 to $34,999
9 per cent $35,000 to $49,999
10 per cent $50,000 to $74,999
15 per cent $75,000 to $99,999
28 per cent $100,000 to $149,999
12 per cent $150,000 to $199,999
19 per cent – $200,000 or more

Overall, the Canadian median household income was estimated at $78,870.

Relationship status of investors

Real estate investment seems to require a team approach. A large majority of investment property owners reported being married or in a common-law relationship.

Respondents who own investment property by relationship status are as follows:

69 per cent Married
8 per cent Common Law
7 per cent Engaged
7 per cent Single
4 per cent Separated/divorced
2 per cent Dating someone
2 per cent Widowed
1 per cent Serious relationship

Age of investors

Over 60 per cent of respondents who own investment properties are 40 years or older, which may suggest that these respondents have benefited from built-up equity from decades-long positions in the existing housing market. They may have more capital to work with due to liquidating existing real estate holdings (such as downsizing from the family home), or have gained from entering the market prior to its recent rapid appreciation.

Respondents who own investment property by age group revealed the following:

30 per cent 30 to 39
24 per cent 40 to 49
22 per cent 50 to 59
17 per cent 60 or over
7 per cent 29 or under

Investment property types

The most popular housing types for investment purposes are detached houses and condo apartments, owned by 35 per cent and 30 per cent of real estate investors. Surprisingly, respondents were just as likely to own land in their real estate portfolio as a condo townhouse.

Zoocasa’s online survey shows the types of investment of property or properties, owned by respondents:

35 per cent Detached house
30 per cent Condo apartment
12 per cent Semi-detached house
9 per cent Vacation home
8 per cent Land
8 per cent Condo townhouse
4 per cent Row house

Home ownership as a life milestone

A large portion of Canadians view home ownership as an important life milestone and often a prerequisite for other milestones. Of respondents, 83 per cent believed that owning a property is a key achievement.

Twenty per cent of respondents as aspiring buyers would postpone having their first baby, while 12 per cent would postpone having additional children, if they couldn’t purchase their desired residence. Thirteen per cent would postpone getting married, and six per cent would hold off becoming engaged.

Overall, 66 per cent of surveyed Canadians felt people should own a property before age 35, and one-third perceived ages 31 to 35 as the prime range to achieve this milestone.

Before 25 years old 3 per cent
26 to 30 years old 27 per cent
31 to 35 years old 36 per cent
36 to 40 years old 14 per cent
41 to 45 years old 4 per cent
46 to 50 years old 2 per cent
51 years or older 1 per cent
I’m not sure 5 per cent
No age 9 per cent

Conclusion

The changing housing landscape is causing today’s home buyers – whether first-timers, move-up buyers, or downsizers – to re-evaluate the timing of other milestones and priorities.

In this regard, real estate sentiments can be considered a barometer of Canadian values, revealing what aspiring homeowners will – and won’t – compromise on to achieve home ownership goals.

Zoocasa is a real estate brokerage based in Toronto.

The 2017 Zoocasa housing sentiments and trends report – Guest Post