What once was considered a staple of the Canadian dream is becoming increasingly out of reach for many Canadians. Yes, we’re talking about home ownership, but why are so many Canadians losing hope of ever owning a home?
Let’s take a look at what’s causing these sentiments and what measures the government is taking to help.
50% of Canadians can’t afford a home?
According to a recent study from Chartered Professional Accountants of Canada, half of non-homeowners believe that they will never be able to afford to buy a home.
Twenty-nine per cent say that home ownership is somewhat likely, and 21 per cent say it is very likely.
The biggest reasons for those in the majority? While the increase in interest rates is certainly not helping, trying to scrape together a down payment continues to be a huge obstacle.
Housing costs add up
Those asked were definitely aware of the other costs associated with buying a house. Taxes, the mortgage payment, and any potential renovation costs were all listed as obstacles to home ownership. Knowing that it costs more to heat a house than an apartment and their utilities could go up also impacts potential buyers.
It’s especially hard for younger Canadians
Younger Canadians are definitely feeling the pinch more than their parents did. The cost of buying a home, the cost of living, and their wages are not on the same keel as previous generations. It’s disheartening for a lot of people.
Yes, getting into the housing market can feel pretty bleak, but there may be a light at the end of the tunnel.
But there is still hope for home ownership
The BC Real Estate Association is predicting the housing market in the province will flatten out over the next year. In their second-quarter report, they predict that while housing prices will creep up a bit more this year, they will likely remain stagnant in 2023. Having quality realtors like the Mayne Brothers to help guide buyers through the coming market.
“On the supply side, we have begun to see active listings move off of record lows and re-sale inventories trend back toward balance,” said BCREA chief economist Brendon Ogmundson. “However, because inventories reached such low levels over the past year, the journey back to balance may take up to a year or more in some areas. As markets adjust to the new interest rate landscape, we anticipate that prices may be somewhat volatile but will ultimately flatten out through 2023.”
A cool-off is coming
There’s also some intervention coming from the government. Last month, discussions were ongoing about implementing a cooling-off period. As reported by the Kelowna Capital News, “the B.C. government introduced amendments to property legislation in March and Finance Minister Selina Robinson tasked the independent regulator with consulting real estate industry stakeholders on the parameters of a cooling-off period and other potential measures.”
The BC Financial Services Authority is recommending the province adopt a mandatory three business day cooling off period, which would allow the buyer to back out of the deal once the offer is accepted.
In a hot real estate market, that period is often waived as an incentive for sellers to accept one offer over another. However, it can leave buyers without time to secure a proper home inspection, which can mean a buyer is stuck with potentially expensive fixes that they weren’t aware of or expecting.
Less than 1% of Kelowna homes are under $200k
While Kelowna has one of the hottest real estate markets in BC, it also currently has the most homes under $200,000. According to a report from Point2, 0.96 per cent of homes currently listed in Kelowna are under the $200K benchmark price. Compared to the other cities in the report, this is a significant number. The next closest is Surrey, with 0.46 per cent of homes under $200K, followed by Delta at 0.27 per cent, and Abbotsford and Nanaimo, both at 0.26 per cent, and then Richmond and Coquitlam both at 0.17 per cent.
If this doesn’t sound too impressive, consider this; the following cities have zero homes under $200K: Vancouver, North Vancouver, Burnaby, Maple Ridge, Port Coquitlam, Chilliwack, Saanich, New Westminster, and Victoria.
So while it may feel pretty bleak when browsing the home listing sites, there’s still value in reaching out to qualified realtors like The Mayne Brothers who’d be happy to help you find the right home for your budget. Give them a call at 250-860-0303.
