Older clients jumping into the condo market

Older clients jumping into the condo market

Older clients jumping into the condo market
If you’re looking for leads to refer on to your Realtor partners, a new survey suggests your older clients are the soundest bet.
 
A recent BMO Capital reports shows that demand for condos among potential homebuyers is greater among Canadians 50 and older.
 
“Condos remain an affordable alternative to the pricey detached market in some major cities,” Sal Guatieri, a senior economist at BMO Capital Markets, told reporters. “For example, a typical Toronto condo today requires just 22 per cent of a median family's income to service; Vancouver condos – while more expensive – are still affordable at 28 per cent of income.”
 
According to the survey, some 30 per cent of prospective buyers over the age of 50 said they are willing to buy a condo over the next five years, compared to just 17 per cent under 50.
 
A full one-third of prospective buyers in Toronto said they were planning on buying a condo, similar to the Calgary market, where 33 per cent showed the same interest – both slight increases compared to a year ago.
 
However, the Vancouver and Montreal markets are a different story.
 
Vancouver fell from 33 to 28 per cent, whereas Montreal slipped to 24 per cent, down three points from 2012.
 
The BMO survey is good news for a Toronto condo market that has seen construction stall and financing falter. Market results released by Urbanation Inc. – a leading condo analysis firm – show that a total of 2,728 new condominium apartments were sold in the first quarter of 2013, down 55 per cent from Q1 2012; reflecting a 29 per cent downward trend from the 2012 fourth quarter.
 
Compounding the problem is a potential $2 billion to $3 billion financing gap for developers, as lenders pull back from the condo market.
 
6 Comments
  • Paolo Di Petta | dipettamortgage.com 2013-06-10 10:54:51 AM
    Funny, this is exactly the opposite of another report from Royal LePage in February - http://mrt.gs/164OuG3

    Sounds more like RBC is trying to put a positive PR spin on a market they're heavily exposed to...

    It's not going to happen though - boomers simply won't downsize - their homes are their symbols of their succees - a once aspiration goal achieved. To give it up would be almost as bad as failure.

    Or, in the words of my dad - "Why would I give up this beautiful house, to pay more money move into a 'shoebox' "

    I'm sure the sentiment is the same from most boomers - especially immigrant boomers who came to Canada from much humbler beginnings.
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  • Elfie Hayes 2013-06-10 2:04:12 PM
    As an mature Canadian I get it! No grass to cut, no snow to shovel, turn the key and go on vacation. Sign me up!

    The fact that a person can still have a home in a vibrant city while spending less than the cost and maintenance of a house is a surely driving sales to those of us over 50 and even those of us much older.

    If I could get my husband to kiss the lawn mower goodbye, we'd be selling our big house and joining the ranks of those who want to enjoy themselves by taking in all that Toronto has to offer! He just happens to love working outdoors.

    Selling our house and living in a world class city would not been seen by me as a failure. r I'd see it as freedom from too much housework, high taxes and on-going repairs.

    Take it from a Boomer, we want to get the most out of life since we're going to be here for a long time!

    Having a big life instead of a big house is very much in keeping with what the modern boomer is looking for.


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  • Paolo Di Petta | dipettamortgage.com 2013-06-10 2:21:04 PM
    @ Elfie - that sounds and awful lot like a realtor's salespitch.

    If you think you're going to "save" on taxes and repairs by buying a Toronto condo, I think you need to double check your numbers. Between taxes and maintenance fees, you'll probably won't save a thing...
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