Article content
As would-be Ontario homebuyers increasingly operate on the fringes of the real estate market, a new survey suggests more Generation Z and newcomers are entering the fray.
The estimated number of Ontarians likely to consider a new home or a pre-construction home will rise from 750,000 people in 2023, according to the second annual New Home Buyers Report from Tarion, a non-profit consumer advocacy group that manages the administration The province's new home warranty program has fallen to just 500,000.
Article content
Tarion said continued high interest rates, the cost of living and inflation are scaring more people away.
“This shift in homebuyer mindset is remarkable,” David MacDonald, group vice president of financial services at Environics Research, which conducted the Tarion survey, said in a news release. “However, this is consistent with other trends in high-priced consumer decisions and makes sense given that overall consumer confidence in Canada is at one of its lowest points since the 2009 financial crisis.”
He said home buying trends are likely to change as consumers see signs of moderation in interest rates and inflation.
Still, new homes remain the top choice for homebuyers as Canada looks to boost construction to address the housing shortage.
According to the survey, 93 percent of respondents considering homeownership are thinking about a home built in the last five years, and 52 percent of them believe a home of this age will give them security.
Homebuyers are also now favoring urban areas, perhaps reflecting an increase in the number of people working in offices in cities. Urban areas are now preferred by 55 per cent of Ontarians, while suburban areas are preferred by 49 per cent, compared to 57 per cent last year.
Article content
Recommended by Editorial
-
Young Canadians think retiring at 65 is an outdated concept
-
The Toronto real estate market is experiencing a drop in sales in the spring
-
Suddenly: Canadians are putting off plans to buy a home
Even as more Ontarians wait for prices to adjust, Generation Z is increasingly looking to enter the market. The survey found that eight percent of new home buyers were born between 1996 and 2012, up from three percent a year ago.
Meanwhile, newcomers to Canada are increasingly looking for houses. Among respondents born outside Canada, the number of new home buyers who immigrated here less than 10 years ago reached 56 percent, up 17 percentage points from a year ago.
Bookmark our website and support our journalism: Don't miss out on the business news you need to know – bookmark Financialpost.com and sign up for our newsletter here.
Share this article on your social network