Younger home buyers compromising to get into the market earlier

A recent study sheds light on the strategies adopted by young Canadians eager to step into the real estate market sooner rather than later.

Houseful, a subsidiary of RBC, unveiled findings from its First-Time Homebuyer Trade-Off Survey, revealing a notable trend among buyers under 30 who are opting to make compromises to accelerate their home ownership journey.

CEO Karen Starns underscored the significance of home ownership as a cornerstone for building intergenerational wealth, emphasizing the value of an early start in this pursuit. According to Starns, many young first-time buyers recognize the potential long-term benefits that come with homeownership.

The survey revealed a significant disparity in purchasing timelines between younger and older first-time buyers. A striking 38 percent of those under 30 are making moves to acquire property sooner than anticipated, contrasting with a mere 18.4 percent of their older counterparts.

To expedite their entry into the market, younger buyers are making concessions that might have previously been deemed non-negotiable. These compromises include downsizing to smaller residences, opting for homes they may not envision staying in for the long haul, and broadening their geographical preferences.

In terms of housing size, a substantial 65.2 percent of buyers under 30 are open to residing in more compact spaces, compared to 47.2 percent of those aged 30 and above. Furthermore, a lower percentage of younger buyers—53.3 percent—reported purchasing their dream home, as opposed to 72.6 percent of older buyers.

Location emerges as another area where younger buyers are willing to compromise. Only 28.3 percent of them prioritize proximity to amenities, in contrast to 34.9 percent of older buyers. Moreover, over half of young buyers—56.2 percent—are open to residing more than 25 kilometers away from major urban centers.

The release of these survey findings precedes the eagerly anticipated federal budget slated for April 16. Industry experts speculate that housing will be a focal point of the budget, with measures aimed at expediting construction and bolstering the supply of affordable housing, possibly through the utilization of government-owned land.

Conducted by RBCx and disseminated by Clint, the survey captured responses from 238 first-time homebuyers across Canada, all aged 18 and above. Data collection took place from February 21 to February 22, offering valuable insights into the evolving dynamics of the Canadian real estate landscape.