58% of Canadian Gen Z and Millennials determined to buy homes despite affordability concerns: study

Nearly 60 per cent of Gen Z and Millennials in Canada are determined to buy a home despite believing it’s unaffordable for them, a new Scotiabank survey reveals. 

The Scotiabank Housing Poll surveyed 3,017 Canadian homeowners and renters from different educational backgrounds, age, gender, and regions.

Overall, the amount of homeowners in Ontario has decreased from 65 per cent to 57 per cent since 2021. Meanwhile, 12 per cent of Ontarians are living at home with their parents while 28 per cent are renting, according to the survey. 

The study found more than half of Millennials and Gen Z believe the current economy is negatively impacting their finances to the point they have to delay investing in a house. However, 58 per cent of Canadians between 18 and 43 years old are aiming to buy a home in the next five years. 

Despite the eagerness of these aspiring homeowners, 27 per cent lack confidence in the exact steps to buy a home compared to 12 per cent of Boomers. Ideally, 35 per cent of Gen Z would like to complete the entire mortgage application process online. 

At the same time, the study found older Canadians are also getting more concerned about buying a home since 2021. 

Although affordability remains an ongoing issue, Canadians can focus on different methods to invest and save money to put towards their first homes. 

“Investing in stocks through a First Home Savings Account (FHSA) can be a smart way for younger Canadians to build wealth and achieve their goal of buying a home. Similar to a TFSA, the FHSA allows for a maximum contribution of $40,000 or $8,000 per year, which will compound and grow tax-free,” Senior Vice President of real estate secured lending at Scotiabank Tracy Gomes told Now Toronto.

Since the FHSA has a maximum lifetime contribution limit, Gomes recommends growing other investments, such as mutual funds, savings account, and Guaranteed Investment Certificate (GIC), in order to have enough funds for a down payment. 

“[However,] if you are planning to buy a home in the next few years and don’t have enough time to contribute the max amount of $40,000 into the FHSA, you could still use your savings from the account in combination with the other new tax proposals available,” Gomes said.