Young buyers of condominiums usually opt for two bedrooms, renting the second, says the mortgage specialist
Mortgage broker Callum Greig was not surprised by census data released Wednesday that showed a roommate’s home is the fastest-growing type of home.
Young people buying their first condo will often buy a two-bedroom unit, not because they want the space, but because they can bring a roommate to help with the mortgage, said Greig, owner of Prime Mortgage Works.
“They are well-qualified people who can take out the mortgage, but they don’t necessarily want to pay the mortgage payment all by themselves.”
While they account for only four per cent of all households in Canada, the number of roommate households increased by 54 per cent from 2001 to 2021, Statistics Canada said.
At the same time, the proportion of people aged 35 to 44 living alone doubled between 1981 and 2021, from five percent to 10 percent.
Greig attributes this in part to a growing number of professional women, some of whom earn six-figure incomes. “They can afford to live alone.”
Households made up of several generations of a family, two or more families or a family living with people who were not relatives are also increasing, growing by 45% in the last two decades and accounting for seven per cent of all Canadian households. . .
About one million Canadian households in 2021 fell into this category.
Greig said he is seeing more intergenerational homes in his business.
The owners will have parents living in their home, possibly in a basement suite. “A lot more of that is happening today.”
In some cases, parents sell their home in another province with the idea of moving to the capital region to be closer to their adult children, but then discover that they cannot afford to buy a home. and Greater Victoria.
So they give the money to their children as an early inheritance and move to live with them, where they are closer to their grandchildren and can receive help for tasks of daily living such as buying groceries.
On Wednesday, the Bank of Canada announced that it was raising its benchmark interest rate by one percentage point to 2.5% in an effort to curb inflation.
Greig predicts that rising rates will keep potential buyers on the sidelines for six to eight months to see how the situation evolves, causing a slowdown in the real estate sector.
“There’s no reason to panic. These rates aren’t forever.”
After the economic situation adjusts in 18 to 24 months, Greig expects mortgage interest rates to be around three percent.
Brendon Ogmundson, chief economist at BC’s Real Estate Council, said “overall it hasn’t changed much” as a result of the Bank of Canada announcement.
A five-year fixed rate mortgage has been based on expectations that the Bank of Canada interest rate will move between 3.25 and 3.5 per cent in the first quarter of next year, he said. .
“It doesn’t really change that today. It could speed up how quickly they get there.”
People can expect a five-year mortgage at a fixed rate of five percent for the foreseeable future, he said.
cjwilson@timescolonist.com
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