Condominiums have become increasingly popular in recent years
More than two-thirds of Canadian households own their home, the highest rate of homeownership since the government started keeping track of that information.
Between 2001 and 2006, homeownership rose for all income groups, even those in the lowest 20 per cent. Immigrants who have been in Canada for more than 40 years are more likely to own a home than Canadian-born people of the same age. And for the first time, more than half of lone-parent households headed by women owned their own home in 2006.
These figures and many more are part of a Statistics Canada report called Changing Patterns in Canadian Homeownership and Shelter Costs, 2006 Census. The report confirms long-established real estate trends as well as providing some hints of some shifts in homeownership patterns.
A look at any of Canada’s urban centres confirms that condominiums have become increasingly popular in recent years. The Census shows that the number of condo owners jumped by 36.5 per cent from 2001 to 2006. In 1981, fewer than four per cent of homeowners lived in condominiums. By 2001 it accounted for nine per cent of households, and in 2006 it reached 10.9 per cent.
The Census information confirms that among the youngest households, where the primary “maintainer” is 24 and under, over three-quarters are renters. But when the head of the household is 25 to 34, 46.9 per cent were homeowners with mortgages in 2006. In the 35 to 44 age group, 58.2 per cent were homeowners with mortgages. The number of homeowners with mortgages dropped to 49.8 per cent for those 45 to 54 as mortgages were paid off, and starting at age 55, mortgage-free homeownership was most common. Only 32.2 per cent of households with a primary maintainer aged 75 and older were renters.
Six in 10 homeowners had a mortgage in 2006. Owners in Alberta are most likely to have a mortgage, while owners in Newfoundland and Labrador are least likely to have one. The share of households with a mortgage is at its highest rate since 1981.
“With the aging of the population and with baby boomers entering their 60s, when mortgages are traditionally paid off, the percentage of households with mortgages could be expected to decline and the percentage that are mortgage-free could be expected to rise,” says the report. “Instead, the reverse occurred between 2001 and 2006.”
It says most of the increase in the proportion of households with a mortgage was because of renters moving into homeownership. Some of it was because of homeowners who took on new mortgages or added to existing ones to finance renovations or other large purchases, says the report. Spending on residential renovations increased by 63 per cent between 2001 and 2006.
Shelter costs, which include mortgage payments, property taxes, condo fees and utilities, are rising faster than the Consumer Price Index, the report says. The median shelter cost for homeowners in 2006 was $10,056, an increase of 21.6 per cent from five years earlier. For renters, shelter costs rose 12.8 per cent to $8,057.
When the share of household income spent on shelter costs exceeds 30 per cent, it reaches the upper limit of affordable housing as defined by Canada Mortgage and Housing Corp. It is used by the government to define the need for social housing.
The report says in 2006, an estimated three million households, or 24.9 per cent of the total, spent 30 per cent or more of their income on shelter. This was up from 2001 but less than the 26.6 per cent recorded in 1996. About 1.5 million renters, or 40.3 per cent of all renters, were in this category. There were also about 1.5 million owners who spent more than 30 per cent of their income on shelter costs, representing 17.8 per cent of all homeowners. But during the five years between 2001 and 2006, owners accounted for 90 per cent of the increase.
The study shows that the homeownership rate for people who live alone (47.8 per cent) is well below the national average but that the number of one-person households increased by 11.8 per cent from 2001 to 2006. Seniors 65 and older represent 33.9 per cent of people who live alone. Women who live alone have a higher homeownership rate than men.
More than 80 per cent of lone-parent households are headed by women, and in 2006, 52.5 per cent owned their homes. While this number is increasing at a faster rate than lone-parent households headed by men, they still have a long way to catch up to the male homeownership rate of 64.9 per cent.
Immigrants to Canada generally become homeowners. By the time they have been here for six to 10 years, 66.7 per cent are homeowners. About two-thirds of immigrants lived in Toronto, Montreal or Vancouver in 2006. The report says that immigrants are twice as likely as Canadian-born people to live in a condominium.
Written by Jim Adair
for Realty Times, Aug 2008