Despite a challenging housing market and affordability issues nationwide, many (38 per cent) of Canada’s prospective first-time buyers under 30 are prioritizing homeownership over other life milestones, like weddings, a recent survey from RBC company, Houseful, shows. For those over the age of 30, this was 18.4 per cent.
No disillusionment
While the younger group is looking to own a home and build equity for their future, they’re well aware of current market challenges: 72 per cent note that market reports make housing seem unattainable and 71 per cent feel that homeownership will be a key piece of their retirement plan.
“Younger adults are increasingly conscious of ongoing housing affordability challenges, which motivates them to secure a financially stable future by seizing saving opportunities earlier,” explains Karen Starns, CEO of Houseful. “After getting a foothold in the market, they can gain the flexibility to pursue other life milestones that are important to them.”
Homeownership: Outranking marriage, travel & vehicles
The survey found that 40 per cent of first-time homebuyers under 30 are making homeownership an important part of their five-year plan. This is more than marriage (24 per cent), travel (30 per cent) and vehicles (33 per cent).
How young buyers are tightening their budgets
Within this same group, 72 per cent are allocating at least some portion of their monthly income toward their first home, while 24 per cent are saving over 15 per cent of their income. To help, they’re also tightening their spending, with 74 per cent of this group reducing discretionary spending like eating out.
“It’s promising to see the common trend among this segment of first-time homebuyers under 30 as they make tangible efforts for long-term financial planning at early stages of their adult lives,” notes Starns.
Of first-time homebuyers in the over-30 group, 47 per cent are putting some of their income toward a home and 61 per cent of this group are decreasing their discretionary spending.
Understanding the costs of homeownership
74 per cent of first-time homebuyers under 30 see a home purchase as the most important financial decision they’ll make in their life (compared to 54 per cent of those over 30). However, 47 per cent of the first group are confident that they understand all the costs associated with buying and owning a home.
