A recent survey by Royal LePage has made it clear how important newcomers to Canada are when it comes to the health of the housing market.
According to the survey results, newcomers account for 21% of all homebuyers in Canada. If the international migration level remains the same, newcomers are expected to buy 680,000 homes in Canada over the next five years.
For the purpose of the survey, a “newcomer” is anyone who has moved to Canada in the last 10 years. Nearly a third are families with children, while a quarter of them are students, and 20% are sole applicants.
"In addition to supporting Canada's economic growth, newcomers to Canada are vital to the health of our national real estate market," says Phil Soper, president and CEO, Royal LePage. "The combined demand for affordable housing among younger Canadians and new Canadians can be met through housing policies that encourage smart and sustainable development, with a focus on protecting and developing green spaces in our urban centres. Canada's economy and labour markets are expanding and it is crucial that housing supply keeps pace."
Nearly 90% of newcomers see Canadian real estate as a good investment and 75% arrive with savings to buy property. The average time between arriving and purchasing is three years.
"It is not surprising that newcomers see a home in Canada as a good investment,” says Soper. “Having lived abroad myself, I have seen first-hand the challenges of relocating a family to a new world. It takes courage and commitment. Newcomers are doing more than investing in Canadian real estate, they are investing in their family's future.”
While newcomers are eager to buy, the homeownership rate is only about 32%. Of those who buy, more than half buy a detached home, 18% buy a condo, 15% buy a townhome, and 13% buy a semi-detached home. Upon arriving, 64% rent and 15% buy. Many newcomers decide to live with family or friends at no cost to them, which allows them to save to buy a home.
Ontario accounts for 46% of all migration to Canada. The homeownership rate for newcomers in the Greater Toronto Area is 32%. Upon arrival, 60% rent, 16% buy, and many live with family or friends. Newcomers account for 21% of all homebuyers in the province, and they’re expected to purchase 286,000 homes over the next five years.
"Ontario, and more specifically the Greater Toronto Area, has greatly benefited from international migration to Canada," says Chris Slightham, president, Royal LePage Signature Realty. "Neighbourhoods across the greater region are blossoming with the continued influx of newcomers who are looking for good schools and job opportunities in thriving communities. While some newcomers are attracted to downtown living, there are still many affordable housing options for newcomers in vibrant communities outside of the downtown core."
So, before you head to the polls on October 21st, ensure the party you’re supporting is encouraging migration to Canada!