Canada

What Problem? Canadian Boomers Love This Real Estate Market: Royal LePage

Soaring home prices may be a pain for some generations, but not for Boomers. Royal LePage released the results of its 2021 Boomer Survey. The survey found the majority are homeowners, with many having most of their net worth in real estate. Soaring home prices aren’t a pain point, but a windfall. It’s no wonder millions are considering buying another home.

Over 3.2 Million Canadian Boomers Are Considering Moving

Millions of Canadian Boomers are considering a move in the next five years. The survey found 35% will be buying a new home, or at least considering it. Using Stat Can data, the brokerage estimates this is about 3.2 million Boomers. 

A regional breakdown shows this is a fairly broad trend for the more expensive provinces. Ontario (37%), BC (39%), and Alberta (41%) were all above the national number. More affordable regions like Quebec and Atlantic Canada both came in at 29%, a full 6 points lower.

The three big real estate markets were higher than the national average. In Toronto, the rate hit 41% of Boomers considering a move. Montreal was lower, but right at the national average. They didn’t provide data for Montreal on this question though. Most likely due to a lack of responses.

Canadian Boomers Considering Buying A Home Within The Next 5 Years

The rate of Canadian Boomers considering buying a home within the next 5 yaers, and the rate that fully intend to.

Source: Royal LePage; Better Dwelling.

“Might” Buy A Home Is Very Different From “Will” Buy One

Considering buying a home and buying a home are two totally different things. Only 8% of Canadian Boomers said “yes” they’ll be buying a home in 5 years. The rest were in the maybe crowd, only considering the purchase. Kind of like Millennials saying they’ll be buying a home. Okay, but have you done the math for your wage on how long it’ll take?

The crowd that fully intends to buy a home within the next 5 years is also overrepresented in expensive provinces, like BC (9%), and Ontario (9%). Alberta (10%) and Saskatchewan (16%) also have higher rates of Boomers intending to buy. 

Fewer Than Half of Boomers Think It’s A Good Time To Sell

Fewer than half of Canada’s Boomers think it’s a good time to sell their home. The national average came in at 45%, according to the survey. BC (42%) and Ontario (41%) both come in under the national rate of people that think it’s a good time to sell. Quebec (41%) had a similar rate to Ontario, and Alberta (31%) came in way under. 

Boomers in the Big Three real estate markets were less likely to think it was a good time to sell. Toronto (44%), Vancouver (30%), and Montreal (41%) all came in under the national average. Really wish they had specifics on why it isn’t a great time to sell. Thinking prices will rise further is one reason making selling less than ideal. Buyer’s gridlock, where everywhere else is too expensive to move, would be another one.

The Majority of Boomers Own Their Home and Have No Mortgage

The majority of Canada’s Boomers own their primary residence and have no mortgage debt. The survey found 75% own their own home. The rate was even higher in BC (82%), Ontario (76%), and Alberta (82%). Quebec (66%) was surprisingly lower than the national average. Stronger tenant protection rights in the region are likely responsible.

The big three cities were all lower than the national average on this one. Toronto (74%), Vancouver (73%), and Montreal (62%) were all underrepresented. Though Toronto and Vancouver are within spitting distance of the national average. 

Most are free of mortgage debt as well. The national average came in at 64% of Boomers who do not have a mortgage. Similar ratios were seen in Ontario (64%), with Toronto (60%) just a little lower. BC (66%), and Vancouver (64%) were both at least as good as the national average. Quebec (57%) and Montreal (56%) were noticeably lower. Even lower, the majority are still mortgage-free.

Almost One In Five Own A Second Home

Nearly one in five Boomers own a second home, including recreational and investment properties. Nationally, 17% of respondents said they own at least 2 homes, which was higher in BC (18%), and Alberta (21%). It was a little lower in Ontario (16%), and Quebec (16%), but within range of being a rounding error. 

The big three real estate markets weren’t far off on the rate of Boomers that own at least two homes. Toronto (16%), and Vancouver (19%) were both very close to the national average. Montreal (15%) was a little lower, but only by two points. 

Nearly 1 in 5 Canadian Boomers Own At Least 2 Homes

The number of homes Canadian Boomers own, including recreational and investment properties.

Source: Royal LePage; Better Dwelling.

A Lot of Boomers Have The Majority of Their Net-Worth In Real Estate

A lot of Boomers have most of their money in homes. The survey found 40% of Boomers have at least 50% of their net worth in real estate. Of those, 27% estimate between 50 and 74% of their net worth is in real estate. The remaining 14% estimate 75% to 100% of their wealth is in real estate. Of the total, another 16% said they weren’t sure what percent of their net worth it represented.

Canadian Boomer Net-Worth From Real Estate

The percent of Canadian Boomers that have less than 50% of their net-worth in real estate, compared to those with more than 50%. The remainder chose not to disclose, either because they didn’t know or didn’t want to.

Source: Royal LePage; Better Dwelling.

The regional breakdown shows expensive regions are predictably overrepresented. Ontario (46%), and BC (48%) had the highest rates. Alberta (36%) and Quebec (34%) were both significantly lower than the national average. 

Toronto is the exception for the big three markets, and not in the direction many would assume. Vancouver and Montreal both came in at 40% of Boomers with the majority of their net worth in real estate. For Toronto, that ratio was higher, with 54% of Boomers having at least half their net-worth in real estate. 

The vast majority of Boomers haven’t been negatively impacted by soaring home prices. In fact, since most are homeowners with no mortgage debt, it’s been great. Especially for the one in five that own a second home. They can cash in part of their windfall, without even moving from their current place.

It’s no wonder millions of Boomers are considering buying another home. They’ll be paying with the equity boom. Who can buy the homes they’re selling at these prices, may be a hitch in that plan though. Even many homeowners are facing buyer’s gridlock, and can’t afford to buy a Boomer’s detached home. Never mind finding millions of buyers over such a short period of time.

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6 Comments

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  • D 2 months ago

    American and Canadian boomers had it easy. A lot of them complained about the high interest rates in the 70’s and 80’s even though it was easy enough for them to get into housing if they worked hard. Not the case today for millennials and zoomers.

    The solution is simple, raise interest rates. A lot of boomers are out of touch and so are the financial “experts”. Creative destruction is the hope for this economy otherwise Canada will end up like weimar.

    • Kate 2 months ago

      Agree

      • flipgstring 2 months ago

        If interest rates don’t go up, no one who doesnt already own a house will ever be able to save enough money to buy one.

        • Tony 2 months ago

          Don’t get your hopes up. Rates are not likely to rise significantly enough to make that kind of impact. If anything house prices will remain elevated and rise moderately over the years keeping in line with the rate of inflation. This should hopefully divert more money to other areas of productive investment instead of out of reach housing. The great reset is happening slowly. Lol

      • Gerald Moodie 2 months ago

        If younger generations wish to see any improvement to home affordability they will have to take strong and decisive action to force change.

  • SH 2 months ago

    Latest polls also show that Boomers LOVE the Trudeau Liberals. Highest support for the Liberals is among 55+ (yes, I know not all in the 55+ cohort are Boomers, but the vast majority are).

    It’s a smart plan – Liberals impoverish young people to further enrich the richest generation in human history. Said richest generation comes out en masse to vote for more of the same. Rinse and repeat.

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