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, released Tuesday, 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 (43.5 per cent) 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. 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,” said Phil Soper, chief executive of Royal LePage Real Estate.
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 with 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.
According to the survey, a quarter of Generation Y lives rent free because of arrangements with family or friends, but that number climbs to 33.4 per cent in the Prairies, 29.7 per cent in Quebec and 27.2 per cent in Ontario.
“The adult children of Baby Boomers aren’t going anywhere fast. 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,” said 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 (50.6 per cent) and bungalows (19.0 per cent). Only 15.7 per cent of Generation Y said they plan to buy a condominium or an apartment. In comparison, 22.9 per cent of Baby Boomers looking to purchase their next residence desire condominiums or apartments.
The survey found that more than half of Generation Y planning to purchase their next residence, intend to purchase in the suburbs (55.7 per cent) compared with the downtown core of a city (21.7 per cent).
“The young people who make up Generation Y are our first-time home buyers. 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,” said Soper. “Even as condominium living becomes more popular across Canada, the study results do not point to a corresponding decrease in demand for traditional single-family homes. For the Baby Boomers that do head downtown, there is a generation waiting to move in.”
Among Baby Boomers who plan to downsize when they purchase their next residence, the most popular reasons are to reduce maintenance (73.7 per cent), free up money for retirement (48.1 per cent) and for travel (30.9 per cent).
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