Despite the perception that aging Baby Boomers may create an oversupply of traditional single-family homes as they downsize into smaller residences, a new Royal LePage Real Estate survey shows that demand for suburban detached homes remains strong among Baby Boomers and Generation Y.
The poll by Leger Marketing found that of the 40.6 per cent of Baby Boomers (born between 1947 and 1966), who do have plans to move to another primary residence, almost half are looking to purchase another primary residence that is a similar size or larger than their current property.
Of the total responses from Baby Boomers who intend to purchase their next primary residence, 66.8 per cent said they will do so in the next five years.
“Baby Boomers are the wealthiest generation in Canadian history,” said Phil Soper, CEO of Royal Lepage Real Estate. “They live in large homes with ample space for their many possessions. They love their garages and their yards. This study clearly indicates that contrary to popular belief, most boomers do not intend to downsize anytime soon," added Soper.
Male Baby Boomers, who are planning to move, are more keen on upsizing their residence than women, with 23 per cent reporting that they plan on moving to a larger residence compared to 12.1 per cent of women.
Baby Boomers looking to purchase a condominium prefer less amenities and low maintenance fees (54.5 per cent) over properties that have many amenities (39.1 per cent).
Seventy-eight per cent of Baby Boomers currently own their own homes.
Contributing to the desire of Baby Boomers to continue to invest in large, suburban homes is the reality of housing children well into adulthood.
According to the survey, a quarter of Generation Y lives rent-free because of arrangements with family or friends. The highest percentage is in the Prairies at 33.4 per cent.
“The adult children of Baby Boomers aren’t going anywhere fast,” said Soper. “Good jobs have proven more difficult for them to find, they’re extending their studies and they’re living at home. It is no wonder the concept of swapping a family-sized home for a small retreat has lost its lustre,” added Soper.
Meanwhile, members of Generation Y (those born between 1980 and 1994), who plan to purchase their next residence, are most interested in single-family multi-storey homes at 50.6 per cent and bungalows at 19 per cent. Only 15.7 per cent said they plan to buy a condo. In comparison, 22.9 per cent of Baby Boomers looking to purchase their next residence desire condos.
The survey found that more than half of Generation Y planning to purchase a home, intend to purchase in the suburbs (55.7 per cent) compared to the downtown core of a city (21.7 per cent).
Forty-three per cent of current non-owners who plan to purchase in the next five years said it is because they are planning to start a family in the near future. The safety of a neighbourhood and proximity to their work, family and friends are the most important attributes when selecting a new home.
Nearly half of Generation Y listed having children as a motivating factor to purchase a home. The least important factors are proximity to the downtown city core and restaurants or entertainment.
“The young people who make up Generation Y are our first-time home buyers,” said Soper. “Like their parents, they dream of owning a lovely house in the suburbs, which provides value as well as access to parkland for children to play and the perception of greater family safety.”