In a recent study that was conducted by Altus Group Canada, a Canadian real estate company, about 80% of renters under the age of 50 would prefer to own their homes. Only 20% of the survey participants said that they rented a property because they didn't want to take on the responsibilities that go along with home ownership or they preferred the lifestyle.
Just about 80% of the participants were holding back on a home purchase for reasons that included:
- Afraid of not being able to qualify for a mortgage
- Feeling that now isn't the best time to make a purchase
- Haven’t been able to save up enough yet for a down payment
Most people do want to eventually become a home owner. Whether it's financially possible or not, the vast majority would still prefer ownership versus renting. The findings from the report also dug a bit deeper based on information from Statistics Canada.
This real estate firm concluded that there are currently about 650,000 renters under the age of 50 in Canada that would be able to afford a mortgage of $350,000. These figures are based on a 3.75% interest rate on a 30-year term.
Of course, a 30 year mortgage is no longer available and many renters will only be able to scrape together a 5% down payment. In this scenario, with a 25 year mortgage at 4.79%, approximately 250,000 renters could afford a $350,000 home.
According to Altus, about 300,000 people were purchasing a home for the first time from 2009 up to 2013. About half of these buyers ranged in age from 25 up to 34. The average cost for these first homes was approximately $268,000 while the average price for all buyers was closer to $303,000.