Canadian Homebuyer Groups and Rising Real Estate Trends in 2021
Thursday Mar 11th, 2021
The pandemic has caused uncertainty in the real estate industry since its beginnings in 2020. All manners of day-to-day life have either ceased or dramatically changed to implement safety precautions. This includes the 4 groups of Canadian homebuyers’ lifestyles and preferences when it comes to finding their properties. Their different demographics will be greatly affected by the emerging 2021 real estate trends.
This article will briefly list the types of Canadian homebuyers and how the 2021 real estate trends can affect each type.
Currents top trends in Ontario real estate market are:
Property focus - Low supply and high demand means there are limited options of properties available to home buyers. Suburbanization is still rising.
Purchasing power - Low interest rates means higher mortgage capacity for most Canadians. Just this Mar 2021, Bank of Canada made an effort to boost the economy by lowering its interest rate down to 0.25%.
Best real property bets are in warehousing & fulfillment, multifamily residential, and medical offices.
Condos are making a come back in Feb-Mar 2021
First-time home buyers usually are 20-30’s looking for their first own residence. They are usually focused on their careers and looking for properties that are close to work and located in nearby conveniences. They are in more need of real estate guidance than any other type of homebuying groups. They are heavily influenced by their parents as they are more likely to need assistance in house down payments.
Property focus. First time home buyers are most likely to stick closer to the bigger metropolis where their careers are. They might prefer to participate in the now returning purchase of condo in downtown areas and not contribute to the low supply high demand real estate market going on right now. Small spaces do not matter to this group as they are more keen in making sure their career is on track and prefer to be close to the varied entertainment districts of the metros.
Purchasing power. This home buyer group would likely be taking advantage of low interest in mortgages. Mortgage brokers are considering taking in first time home buyers with the right income brackets and have the right paperworks.
Starter home upgrade/repeat buyers can be in their 30s and 40s that already have their own residence but are looking into getting bigger spaces for life changes - getting married or growing their family. They also would want to maximize the equity in their current property to afford a new home in the suburban area. They are looking more to settle down in a community that has nearby schools and a nice neighborhood to raise their kids.
They would need realtor’s help in maximizing their equity on their current property, staging and getting the best market price, and knowing the local market they are looking into buying their new home.
Property focus. This group would be more suburban or the popping up 18-hour cities and towns. With the work at home allowed in their jobs, they can ditch the limiting location near their workplaces and opt for the bigger spaces outside the cities and into the rural areas. Space and local amenities are their main goals to provide a community for their growing or future family. They also would be looking for ready to move in deals to minimize moving and family life disruptions.
Purchasing power. This group has built equity in their homes so they can afford a bigger property. However with the rising listing price in the GTA, they will be forced to look into rural areas and small towns an hour or two away from the metros. They will be more likely to suffer frustration in finding a property in this current hot seller’s market.
Seniors are the home-buying group around their 50s and up age bracket. They are looking to downsize or find an affordable but accessible property near their family. They have bigger equity in their homes because they normally have stayed in this property longer than any other home-buying groups.
Property focus. Seniors are looking for accessibility and smaller spaces. They are more likely to move somewhere near their children so they can be closed with the grandkids. Smaller spaces are a big factor as they tend to downsize to minimize house upkeep and maintenance. Accessibility is also a factor as seniors would need ambulatory installations.
Purchasing power. Seniors might also have to adjust to a lower income but with high equity in their current property that can leverage what they can afford. They tend to downsize into a modest condo or townhouse as long as they are close to family.
They would need real estate help with crunching the numbers if they decide to scale down their property, options for reverse mortgages, adjust their property to what they can afford decently.
Rental property investors are usually in their 30s and have built equity from the property they bought years ago to purchase rental properties for more income stream and focused on long-term growth rather than flipping and making a profit in a couple of years.
Property focus - This group might be less affected by the low inventory listing as they look into rental properties than residential potentials. They can look further into other locations that can accommodate moving out city dwellers into rural areas.
Purchasing power - With their equity builds and thriving, these home buying groups can have more affordability and easier mortgage approvals.
Real estate agents would need to help them know the ROI of their investments, guidance on paperwork, and match listings for this group’s wants and needs.
You belong to one of these home buying groups and this can help you know how the rising trends in real estate can affect your options and preferences in finding a home or investment. To help you navigate in this hot seller's market, talk to JoAnn Visaretis for expert advice and number one service.