Houseful (an RBC company) recently conducted its First-Time Homebuyer Trade-Off Survey. It sheds light on how prospective homebuyers must make decisions — by carefully weighing their options and making compromises based on individual circumstances.
Survey findings show an interesting trend among young Canadian first-time homebuyers under the age of 30. These individuals are not only entering the housing market sooner than anticipated but are also demonstrating a willingness to embrace significant trade-offs that were traditionally perceived as deal-breakers.
“Home ownership is the beginning of generational wealth creation,” says Karen Starns, CEO of Houseful. “Many younger first-time homebuyers recognize that home ownership is a life-long pursuit, and an early start to the journey can deliver exponential long-term value to support future goals.”
Young homebuyers embrace trade-offs for early ownership
In Canada, younger first-time homebuyers are being pragmatic when it comes to homeownership, displaying greater flexibility in their preferences. Consequently, they are achieving their goals faster than originally envisioned.
Survey results indicate that a substantial portion of first-time homebuyers under 30, either recently purchased or currently in the market, are buying earlier than expected (38 per cent), compared to their counterparts over 30 (18.4 per cent).
Their accelerated timeline can be attributed to adaptable lifestyles, enabling more significant trade-offs, which have included:
Opting for cozier, smaller spaces. A majority of first-time homebuyers under 30 (65.2 per cent) are willing to settle for smaller living spaces, contrasting with those over 30 (47.2 per cent).
Prioritizing the present. Instead of fixating on a forever home, younger homebuyers prioritize properties that suit their current life stage, with only 53.3 per cent claiming to have found their dream home, compared to 72.6 per cent among those over 30.
Having flexible location preferences. Location holds less sway for younger homebuyers, with only 28.3 per cent prioritizing it, as opposed to 34.9 per cent among those over 30. Additionally, a majority of younger buyers (56.2 per cent) are open to residing more than 25 kilometres away from major cities.
Wealthier buyers exercise patience for perfection
On the flip side, a different demographic is pursuing a divergent path to achieving homeownership success in Canada. First-time homebuyers or those currently in the market with a household income between $100,000 and $150,000 are willing to bide their time to secure their ideal home.
Key insights from this group show that they’re:
Patient. Nearly half (49 per cent) of those surveyed within this income bracket have delayed or plan to delay their purchase to find their dream home, compared to just 14.6 per cent among those with incomes exceeding $150,000.
Headstrong. Home size and location remain crucial for individuals in the $100,000 to $150,000 income bracket, with less than half (46.5 per cent) willing to compromise on size (contrasting with 61.4 per cent among those earning over $150,000) and just 12.8 per cent willing to move over 50 kilometres away from their preferred city.
Satisfied. Despite the extended wait, first-time homebuyers in this income range report the highest levels of satisfaction (85 per cent) with their purchases, surpassing those with incomes above (60.9 per cent) and below (78.2 per cent) this bracket.
“As homebuyers make one of the most important decisions of their lives, they need the right support to navigate an overwhelming market with confidence,” says Starns.
