For under 30s, owning a home is more important than other financial goals
Buying a home in Canada today is not easy for young adults, but that’s not stopping them trying their hardest to achieve that goal.
Despite the cost of living and housing affordability issues, adults under 30 are prioritizing homebuyers above other financial and life goals, according to a new report published today (August 21) by Houseful, the real estate technology platform acquired by RBC in 2023.
That doesn’t mean this young cohort is ignoring the facts. More than seven in ten respondents said they know the stats suggest buying a home may be unattainable for them, but over the long term it’s a key element of their financial planning with 71% saying it will be an important part of their retirement plan.
"Younger adults are increasingly conscious of ongoing housing affordability challenges, which motivates them to secure a financially stable future by seizing saving opportunities earlier," said Karen Starns, CEO of Houseful. "After getting a foothold in the market, they can gain the flexibility to pursue other life milestones that are important to them."
Almost eight in ten single and unmarried first-time homebuyers under 30 say that saving for a mortgage is their financial focus rather than having a more lavish wedding, compared to seven in ten over 30s.
Buying a home is the top priority in under 30s’ five year plan (40%) followed by buying a car (33%), travel (30%), and marriage (24%).
Nearly three-quarters of under 30s believe buying a home will be the most important financial decision they'll make in their life compared to 54% of those over 30. However just 47% feel confident that they understand all the costs associated with buying and owning a home.
To achieve their homeownership goal 72% of respondents are saving at least some of their monthly income towards a down payment including 24% who are saving at least 15%. This compares to just 47% of potential first-time buyers over 30.
Cutting back on spending it aiding young adults’ savings as they reduce expenditure on eating out and shopping (74%) at a higher rate than those over 30 (61%).
"Each person's path to financial stability is unique to their own experiences and life journey," said Starns. "However, it's promising to see the common trend among this segment of first-time homebuyers under 30 as they make tangible efforts for long-term financial planning at early stages of their adult lives."
