Home affordability crisis a legacy of the pandemic, says real estate association

More than half — 56 per cent — of Ontario would-be homeowners have given up or are pessimistic that they will ever own a home. A quarter of prospective buyers, who remain optimistic, are increasingly worried about their prospects.

An online poll of 2,000 Ontario residents for the Ontario Real Estate Association (OREA) shows 45 per cent of potential buyers 18 to 29 years old have considered moving out of the province in search of more affordable housing. In the Toronto region, 26 per cent of all the residents polled have thought about moving in the last year.

Among Ontarians under age 45, 46 per cent of nonhomeowners and 34 per cent of homeowners have thought about relocating.

The findings by Abacus Data underscore that a housing affordability crisis will be part of the COVID fallout going forward, said OREA CEO Tim Hudak. With provincial and municipal elections a year away, all political parties should be building housing affordability ideas into their platforms, he said.

“It has come to such a point that so many talented Ontarians are considering moving out of our province to find a home in another one. This is definitely a red flag for governments at the provincial level as well as local municipalities,” said Hudak, former leader of the Progressive Conservative Party of Ontario.

“This is not only a human cost when families get broken up and scattered across our country but also an enormous economic loss to our province. These are educated, talented millennials and Generation Z that are now basing their decisions on where to locate on housing costs,” he said.

The trend to working from home makes the threat of leaving greater, he said, because you can still get a job in Toronto and live in New Brunswick, where homes cost less.

Nearly seven out of 10 respondents felt there were solutions the province could pursue to solve the high price of housing. Survey respondents offered strong support for the prevention of money laundering; taxing foreign home buyers and increasing first-time homebuyer tax rebates.

The federal Liberal government has already initiated the idea of a registry for foreign home buyers but Hudak said it’s not clear if the provinces will feed that register.

Eighty-two per cent of survey respondents indicated some level of support for allowing renters to purchase equity in the property where they are living. There are new financial technologies that support rent-to-own or co-ownership models, said Hudak. In the UK, pensions are working to invest in homes, not to own and rent out but to be co-owners of those residences.

As well, he said, survey respondents saw potential in converting underutilized commercial space.

“We do believe that you’ll see some consolidation in the office sector post-COVID, looking for new approaches to convert some of that to mixed-use residential and commercial, so that’s office buildings or empty malls,” said Hudak.

He said he expects governments will shrink their footprints — something the City of Toronto has already been considering — with more employees working from home or having more flexible work arrangements. Using surplus properties for rental or affordable homes “would be a smart move,” he said.

Despite the pessimism about housing affordability, 42 per cent of nonhomeowners who aspire to buy a home indicated they expect to achieve their goal within five years. Although 56 per cent would prefer a detached house, nonhomeowners viewed all forms of housing as unaffordable with townhouses and condos being only slightly less expensive.



The survey was conducted between June 1 and June 7 and is considered accurate within 2.17 per cent 19 times out of 20.

OREA has 79,000 Ontario real estate industry members.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *