Canada’s baby boomer generation outnumbers every other age group in Canada. Statistics Canada’s 2016 census revealed a historic increase in the number of people over 65- a jump of 20 per cent since 2011. By 2031, about 23 per cent of Canadians will be seniors.
What is significant about this group of seniors is that they differ greatly in their lifestyle choices from their previous counterparts. Instead of taking the transitional path of retiring and moving to retirement homes, more boomers continue to work and stay in their homes longer. According to Stats Canada, “In 2015, one in five Canadians aged 65 and older…reported working during the year.” A recent Canada Mortgage and Housing Corporation report also finds more seniors are choosing to stay in their houses rather than moving into retirement homes or rentals. This is due to rising income and growing social support services.
In Toronto, for instance, in 2016, a quarter of homes were owned by seniors, up 4.5 per cent from 2006. And, the average yearly population growth for the boomer segment will be about 4 per cent over the next decade, according to the Ontario Ministry of Finance.
What does this mean for the real estate market? As this cohort of healthier and wealthier aging boomers stay put in their homes, it will contribute to an even tighter housing supply – and consequently, rising values. And as more seniors eventually downsize to condos, the competition for the already low inventory of condos will intensify. Already, seniors make up 32.6 per cent of condo owners, according to Stats Canada.
Environics Analytics found that in 2016, the average net worth of households with adults aged over 65 rose by 86 per cent since 1999, and they are investing this wealth in real estate. Stats Canada reports that one-third of baby boomers are likely to help their children purchase a home by providing a living inheritance, and many have significant investments in real estate.
The signs are pretty clear. The affluence and independent lifestyle choices of this huge demographic group promises a robust real estate market for years to come.