It’s looking like it’s pretty safe to say that the majority of first-time buyers in the Greater Toronto Area want to live close to work.
A new survey conducted by Genworth Canada in collaboration with Royal LePage unveiled key trends among first-time buyers based on the last two years of activity across the country.
A big one is that 57% of first-time buyers are worried that they will miss out on a home that they want because they can’t come up with a large enough down payment. Though homes in Montreal are more affordable than in Vancouver, 60% of first-timers in Montreal are anxious about making a large enough down payment, compared to 58% in Vancouver. First-time buyers in Toronto are easily the most anxious with 68% feeling the pressure to make a significant down payment.
"While interest rates remain historically low, it is not surprising that first-time home buyers in Montreal are increasingly concerned about their down payment," says Phil Soper, president and chief executive officer, Royal LePage. "Montrealers have been watching home values escalate over the past three years. Many are wondering if they have time to grow their down payment or if they should get in the market now as prices continue to rise."
Before buying, 25% of first-time buyers lived with parents or with relatives, and 43% of them paid rent, with only 30% paying less than market value. Nearly 20% of those living at home said they delayed their parents’ decision to downsize. Shockingly, 64% said their parents don’t have plans to downsize after the kids leave the nest. In Ontario and Toronto, more first-time buyers lived with their parents or relatives before buying (30% and 34%, respectively).
When it comes to having more space or living closer to work, 48% of first-time buyers would buy a smaller home if it meant they lived closer to work. Only 32% of first-time buyers value larger properties, even if it means a longer commute.
"There is a large portion of first-time home buyers in Toronto who will sacrifice size for location. Time is important – as are childcare, schools, and proximity to work," says Caroline Baile, broker, Royal LePage Your Community Realty. "Sometimes that means purchasing a condo in the city within walking distance of work, or even living with parents a little longer to position themselves better to get the home they want." In Toronto, 59% of first-timers said proximity to work was more important than square footage.
Last week, Sotheby’s International Realty Canada released a report that said among buyers aged 20-45 years old, 51% prioritized neighbourhood safety when buying a new home, and living close to work was the second highest at 37%.