More than a quarter of renters in Canada plan to purchase a home within the next two years.
27% of renters plan to buy a property in the next two years; 40% among renters aged 18-34
Of those who do not plan to buy a home in the next two years, 54% say they do not feel their income will be sufficient to afford a property they desire; 61% among those aged 18-34
29% of Canadian renters say they considered buying a property before signing or renewing their lease; 41% of them lacked a sufficient down payment
In British Columbia, 25% of renters spend more than half of their net income on monthly rental costs, well above the national average of 16%
One third of Canadians live in rental accommodations, and that figure has been gradually increasing in recent years, as affordability challenges in the resale market persist. According to a recent survey, conducted by Hill & Knowlton, 27% of Canadians who currently rent their home say they plan to purchase a property in the next two years. Among those aged 18 to 34, that figure jumps to 40%. Meanwhile, 69% of renters say they do not plan to buy a home in the near future. Among them, more than half (54%) do not feel their income will be sufficient to afford a property in the area where they wish to live (61% among respondents aged 18 to 34).
Of renters who say they plan to buy within the next two years, half (50%) say they will have a down payment of less than 20%. Twenty-six per cent say they will put 20% down, while 15% say they will have a down payment of more than 20%. In Canada, mortgage insurance is required for homes purchased with less than 20% down.
When asked how they will come up with their down payment, 53% of respondents said they will use savings accumulated over the years, while 46% said they will take advantage of the First Home Savings Account (FHSA), and 29% said they will draw on their RRSPs using the Home Buyer's Plan (HBP). Twenty-five per cent said they will use a financial gift from family or an inheritance. Respondents were able to select more than one answer.
Forty-four per cent of renters planning to purchase in the next two years believe they will be able to afford a home in their current city of residence, while 37% do not. Among those who don't believe they can buy in their current location, 40% say they will have to travel more than 50 kilometers to buy within their budget, while 21% believe they will have to search for a property within a 31-50 kilometers radius and 18% say they would need to look within a 16-30 kilometers radius. Only 9% of respondents are confident they could buy within 15 kilometers of their current location.
Home ownership is deeply ingrained in the Canadian dream as a solid long-term investment. Many Canadians, particularly younger individuals and those with remote work options, are increasingly relocating to realize this dream. This trend is expected to drive continued migration from high-cost regions like southern Ontario and parts of B.C. to more affordable housing markets nationwide.
