Photo: James Bombales
Industry watchers have long debated to what extent Canadian buyers rely on the Bank of Mom and Dad when purchasing their first home. According to a new poll, it’s more than you might think.
“As intention to buy continues to climb in Canada, just over one-third (35 per cent) of Canadians indicated they had received/would be receiving financial assistance from their family for a downpayment,” reads RBC’s home ownership poll, released yesterday.
The poll found that 50 per cent of Millennials surveyed expressed homebuying intentions, while 32 per cent of Canadians overall were planning to buy a home in the next two years.
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The findings back up a February report from Sotheby’s International Realty, which found that roughly one third of Baby Boomers surveyed planned to, or had already given, a financial gift to their children to help them get into the real estate market.
“Of living inheritance givers, 12 per cent have already transferred funds to beneficiaries,” reads the report. “22 per cent plan to do so in the future, with almost half of this segment planning to do so within the next five years.”
The report also found that the median size of the financial gift in question was between $25,000 and $49,999, with 82 per cent of respondents indicating that the money would go towards a first-time home purchase.
“Baby boomers affect the Canadian real estate market on multiple levels…as arbiters of market confidence and as indirect influencers through their financial support of the next generation of home buyers,” writes Sotheby’s president and CEO Brad Henderson, in a statement.
Family support may be crucial for Millennials looking to buy in the near future. RBC found that 11 per cent of those surveyed were hoping to make a purchase in the next few years.
“The age group…is reporting an increased likelihood of buying a home in within the next two years,” reads the report.