TORONTO—According to the RE/MAX 2021 Housing Affordability Report, released July 20, one in Canadian homebuyers are exploring alternative options to help them get a foot into the housing market.
Strategies include renting out a portion of a primary residence (21 per cent), pooling finances with friends or family to purchase a home (13 per cent) or living with like-minded neighbours in a co-op/shared living arrangement (seven per cent).
According to a Leger survey commissioned by RE/MAX, 42 per cent of Canadians said the high price of real estate was a barrier to entry into the market. This is up four per cent from last year. Among prospective homebuyers, millennials and Gen Z are most likely to consider alternative regions and communities or financing options to keep affordability in play.
Key barriers to affordability for many would-be buyers, according to the Canadian consumer survey, include a shortfall in salary (26 per cent); the fear of rising interest rates (18 per cent); the fear of being “house poor” (18 per cent); lack of steady full-time employment (16 per cent); current levels of household debt (11 per cent); and the mortgage stress test (11 per cent).
Toronto and Vancouver have remained the least affordable year-over-year, according to the report.
Despite an uptick in prices from 2020 to 2021 of approximately 20 per cent ($465,903-$561,701), Ottawa continues to be a good option for affordability seekers as well, particularly first-time homebuyers, RE/MAX said.
According to a survey of RE/MAX Canada brokers and agents, some of the most affordable neighbourhoods across Canada include Washington Park, Regina; New Waterford, Cape Breton, Nova Scotia; West Flat, Prince Albert, Sask.; Bayview, Sault Ste. Marie, Ont.; and Portage La Prairie, Central Plains, Manitoba.
“It’s promising to see Canadian buyers deploying their ingenuity to be able to buy a home, but we must address the urgency of the underlying affordability problems, which are predominantly systemic,” said Elton Ash, a manager with RE/MAX of Western Canada, in a statement.