While housing prices in Canada’s most active markets remain on the rise, this growth has the dual side effect of making Canadian real estate both more attractive and more unaffordable for first-time buyers, according to an analyst.
In a piece for The Globe and Mail
, renowned finance columnist Rob Carrick said that while home ownership remains important in millennials’ minds, this demographic will have to contend with the crushing costs that would prevent them from making bank in a real estate investment.
“There’s simply not that much more room for houses to rise in price before they become unaffordable enough to curb demand. Expect long-term price appreciation in line with the inflation rate,” Carrick wrote.
The costs of a property in Canada aren’t merely financial, the analyst said.
“Forget about your restaurant and bar lifestyle,” Carrick stated. “[The long-term price] of owning can soak up a lot of the cash you used to socialize with friends.”
Additionally, Carrick said that the huge disconnect between the experiences of the previous generation and the expectations of millennials might sow the seeds for further disappointment on the latter’s part
“Your parents have no idea: They’re pushing you to buy because they made out like bandits in housing. But there’s virtually no chance of a similar financial windfall for you,” Carrick warned.