It’s no secret when it comes to housing; the younger generation is feeling the squeeze. While higher housing prices are good for Home Owners that purchased a home prior to markets escalating, as it means increased wealth for them; however it is not beneficial for those who have not yet purchased a home and looking to do so, especially Millennials.
It should be an exciting time for younger Canadians that are finishing school, beginning their careers, looking for homes and starting families. However, many are finding it more stressful than exciting. Many Millennials are feeling the squeeze with stagnant incomes, mounting debt and feeling as though they have less time. Millennials are often taking on secondary jobs to help increase their income to save for a house or pay off their debt.
An advocacy group, Generation squeeze reports that housing is a primary source of wealth for Canadians 50+; while it is a primary source of debt for younger Canadians. Young Canadians have to save on average twice as long for a 20% down payment. Even with lower interest rates today, higher home prices mean average monthly mortgage payments are larger. Some Millennials are delaying their home purchases and delaying starting a family life as a coping mechanism, while others are taking on secondary jobs.
For those who do not want to delay, a new trend is emerging. Recently, Huffington Post dug into what Millennials are doing to help solve their housing challenge. They found that younger Home Buyers are looking to team up with family or friends to share the burden of getting into the real estate game by co-purchasing a house together, enabling them to get a foot in the door. It indicated that a recent RBC poll found that 24% of young buyers would consider going in on the purchase of a house with a family member, up from 14.7% in 2015. Clearly this option to get in the housing game is being seriously considered by more people of the younger generation.
While some members of Generation squeeze are looking for creative solutions to get into their first home, the question remains are governments doing enough to help Millennials. Or is it going down a path that leaves less and less for younger generations. Make sure to share your voice and work together to help create a generation with fewer squeezes. We need communities with mixed and affordable housing for all. We need to ensure we are building a community that works for all generations and enables all to live up to their full potential.