Condo costs in the two most expensive housing markets of Canada have risen rapidly making it more difficult for millennials to finish their purchase.
The average cost of Greater Vancouver condos sold in July reached a record $664,944, up 15.9 percent from a year before. In the Greater Toronto Area (GTA), the average cost of condos sold last month hit $501,750, up 23.2 percent from July, 2016, although down 7.3 percent from the peak of $541,392 in April.
Millennials — people born between 2000s and the early 1980s — are currently currently struggling to save for payments that are down that are sufficient to go into the housing market in the Vancouver and Toronto regions, particularly in Canada. Real estate company Royal LePage focused on a subset dubbed “summit millennials,” who now range in age from 25 to 30.
“Facing challenges their baby-boomer parents never struck, summit millennials are faced with significant challenges that vary based on where they reside,” Royal LePage chief executive officer Phil Soper said in statement.
In a poll of millennials across Canada, 64 percent of the respondents said they consider properties in their respective areas are unaffordable. The poll’s respondents in British Columbia had the most pessimistic view of the capacity to buy, with 83 percent of those canvassed in B.C. stating their place is unaffordable — the maximum rate in the nation.
Leger conducted the survey for Royal LePage in June.
Fifty-three percent of the respondents said they are prepared to spend around $350,000 for their home purchase. Thirty-five percent of those surveyed said while 50 percent stated they rent, they have a home. Most of remaining 15 percent said they reside with relatives or their parents.
“The pent-up demand for housing from millennials is enormous, with just a third of the large demographic currently having a property and an overwhelming majority needing to be homeowners,” Mr. Soper stated.
In the GTA, $350,000 will be sufficient to obtain a “starter” condo with 910 square feet of living area, compared with the same budget in Fredericton landing a four-bedroom detached home with 2,568 square feet in the New Brunswick capital, in accordance with Royal LePage.
61 percent of the millennials stated they are eager to move to find affordable housing.