Millennial Home Ownership:
Although most of the properties are owned by older generations, home ownership has become a goal for Millenials. Baby Boomers ( also known as Boomers) and Generation X are two biggest property owners in Canada. Millennials on the other hand are the new force that drives the real estate market in Canada. Millennials home ownership however is not as easy as it was for their parents. In order for millennials to be able to afford a home in a big city like Toronto, they have to qualify for sufficient mortgage and enough down payment.
Average home price in a city like Toronto has increased by approx 460% in the past 25 years ( from $194,251 in January 1996 to $910,290 in March 2020 )*. Thus affordability is a big challenge for millennials who are looking to buy a home.
Because of the high cost of living in Toronto, many Millennials choose to pay their own mortgage rather than paying rents that are going higher and higher in the city of Toronto.
Millennial and Home Buying Challenges:
The biggest challenge for millennials is the affordability and home prices. In my next article I’ll write about how to afford a home, and with how much income you can live in what areas of Toronto.
Does it worth to rent anymore:
In many big cities, such as Toronto, a big portion of tenants are young professionals and millennials. The way the economy is going, in very few cities renting might still remain an option, not anymore in Toronto and many other major cities. In order to know whether renting is better or buying your own home, our development team came up with a rent vs buy calculator that can help you find out what’s the optimal rent. Optimal rent is the amount of rent that if you can rent that much, it’s better to keep renting, but if you pay rent more than that, you might be better consider buying your own home.
Millennial and Home Buying, where to get help:
Affordability, consists of Down Payment and Mortgage. Millennials who are looking to buy a house nowadays can enjoy the historic low interest rates in Canada. Lower interest rate means more affordability for the same level of income. To get more info you can use our Mortgage Calculator.
The biggest affordability challenge in my opinion, as a Millennial Toronto Real Estate Agent myself, is the Down Payment! There are creative ways for home buying millennials to gather the down payment they need to purchase a house.
Here you can find ways about how to find down payment to buy a home!
To locate the best property, take a look at “ the best places to buy real estate in Toronto “. Basically for a Millennial the main factor to locate a property is the price point. Good news is that Millennials still can find affordable homes in or around GTA. But if they insist on living in Downtown Toronto, the chances would be higher that they might need to compromise on factors such as Size, Parking, Backyard etc.
Millennials Home Ownership, Navigating through crazy real estate market:
Millennials are famous to be tech savvy and smart. However they also can take advantage of the services that a Top Toronto Real Estate Agent can provide to them.
For those who love to live in big cities such as Toronto or Vancouver, the home ownership might come with other challenges than merely the prices. I, as a Millenial Toronto Real Estate Agent myself, have helped numerous millennials in the past several years. The problem that Millennials, and First-time home buyers in general, face in a market like Toronto, is how the sellers market works. Toronto’s real estate market has been a sellers market in the past few month, current home inventory in Toronto in March 2020 is 8,816 active listings*. With the Month of Inventory of 1.2 MOI, which is Historically Low, the lowest since April 2017, when the then government of Ontario introduced a fair housing plan to control the market.
In the sellers market something that is common is “bidding wars”, you may also know it by “Multiple Offers situation” ! Buyers need a seasoned REALTORⓒ by their side to win the home of their dreams while competing with others! A professional Buyer real estate Agent knows how to help millennials to overcome these kinds of obstacles in the way of purchasing their home!
For more information you can view this article about “ What Does A Real Estate Agent Do For A Buyer”.
*Source: TorontoMLS Historic Residential Data.