Seventeen percent of Canadian baby boomers plan on buying new homes in the next five years, says a survey by Royal LePage.
The real estate company says this group of 1.4 million potential buyers and sellers will have a “meaningful impact on the housing market.”
Of those planning to buy, 45% are likely to purchase a detached home, 32% will likely buy a condo, 10% are interested in a semi-detached/town home and 5% are interested in a recreational property.
“While the wave of older consumers will increase competition for condominium property in particular, there is no single type of home that boomers will be investing in,” says Phil Soper, CEO at Royal LePage, in the release. “Our research does indicate that smaller cities and recreational areas will attract more investment than major cities.”
More than half of those surveyed (59%) are choosing to renovate their home, though, rather than buy a new one, adds the release.
The survey also found that boomers are choosing to live in smaller cities and recreational areas over big cities, which are seen as being unaffordable for retirement. More than half of those surveyed (56%) said they think the housing market in their city or region is unaffordable. This number rises to 78% of those surveyed in B.C. and 63% of those in Ontario.
The survey also found that 77% of those polled who own a home have paid off more than half of their mortgage, and 61% have paid off over 90% of their mortgage. Half of the boomers surveyed who own a home have less than 25% of their retirement savings tied to real estate.
Millennials still living with parents
Of those boomers surveyed across Canada with children still living at home, 9% don’t expect them to move out until after the age of 35, said the survey. In B.C., that figure was 24%.
“Boomers are allowing children to reside at home well into adulthood,” Soper said. “Yet they won’t stay forever, and when they go, the folks are going condo shopping.”