With rising home prices across the country, the reality of owning one has become far beyond reach for nearly half of Canadian millennials.
A poll commissioned by KPMG has found that while 72 per cent of millennials would like to own a home in the future, 46 per cent of respondents said that home ownership is a “pipedream”.
For those between the ages of 23 and 38 who have been fortunate enough to become homeowners, 46 per cent said they received a financial boost from their parents to be able to do so.
A Canadian Mortgage and Housing Corporation report found that millennials now take an average of 13 years to save for a 20 per cent down payment in comparison to their parents who took an average of five years in 1976.
“It seems pretty clear that millennials are in a unique situation in terms of their ability to purchase a home – which has historically been a foundation for retirement stability,” said Martin Joyce, Partner, National Leader, Human & Social Services for KPMG. “Most Canadians agree that the government has a role to play in making it a more achievable dream for many of them.”
While millennials are the most educated generation, they’ve taken on high levels of student debt. And those who’ve bought into the housing market have larger mortgages compared to generations before them.
The survey pointed out that debt-to-income ratio for young millennials now stands at 216 per cent, which is sky high compared to 125 per cent for Gen-Xers and 80 per cent for baby boomers at the same age.
Joyce added that 65 per cent of millennial respondents also said they feared that they won’t have enough saved for retirement if they choose to put money down on a house.
The KPMG poll had respondents of all ages weigh in on possible solutions that would allow home ownership to be more attainable for the millennial generation. Ideas consisted of: making housing more affordable, making it easier to use RRSPs for down payments, raising TFSA limits and implementing a new registered savings system to make housing more affordable.