– Homeownership is still an issue for young Quebecers –
L'ÎLE-DES-SŒURS, QC, Nov. 30, 2017 /CNW Telbec/ - The Québec Federation of Real Estate Boards (QFREB) published a study today that examines the reasons that could explain Québec's significant lag in its homeownership rate compared to other Canadian provinces. According to the latest 2016 census data released by Statistics Canada last October, 61.3 per cent of Québec households owned their home in 2016, compared to an average of 67.8 per cent in Canada.
"Although the gap has narrowed since 1971, Québec still remains well below the national average," said Paul Cardinal, Manager of the QFREB's Market Analysis Department. "The homeownership rates in the province's six census metropolitan areas (CMAs) are no exception, particularly those of Montréal and Sherbrooke which, in 2016, had the lowest proportion of homeowners among all CMAs in Canada," he added.
The homeownership rate has been decreasing among young Quebecers since 2011
It is also clear that homeownership remains an issue for young Quebecers. According to the latest census data, between 2011 and 2016, the homeownership rate among those under 25 years of age fell by 2.5 percentage points (pp). The rate fell by 2.8 pp for the 25 to 34 age group, by 2 pp for the 35 to 44 age group and by 0.4 pp for the 45 to 54 age group.
| Homeownership rate by age group of the primary household maintainer in Québec |
|||
| Age group |
2011 |
2016 |
Difference (pp) |
| Under 25 years |
19.0% |
16.5% |
-2.5 |
| 25 to 34 years |
47.0% |
44.2% |
-2.8 |
| 35 to 44 years |
63.6% |
61.6% |
-2.0 |
| 45 to 54 years |
68.6% |
68.2% |
-0.4 |
| 55 to 64 years |
69.1% |
69.5% |
0.4 |
| 65 to 74 years |
66.0% |
67.2% |
1.2 |
| 75 years and more |
55.7% |
59.9% |
4.2 |
| Source: Statistics Canada, Census and National Household Survey (NHS) 2016, CREA, CMHC |
Thus, in order for young Québec households to benefit from improved access to homeownership, the QFREB has been advocating for several years now for an exemption of the welcome tax for first-time buyers. This measure would take the form of a refundable tax credit for the purchase of a first home and would help the province catch up in its homeownership rate. Like the Canadian Real Estate Association, the QFREB is also proposing a reform of the Home Buyers' Plan (HBP).
How can Québec's lag in homeownership be explained?
Among the factors that explain this difference, two in particular caught the attention of QFREB economists: the composition of households as well as the opportunity cost of ownership.
Household composition could partly explain Québec's lag in homeownership. Single-person households are more prevalent in Québec (33 per cent) than elsewhere in Canada (28 per cent). "Since it is more difficult for a single person to save the down payment required for the purchase of a home than it is for a couple, it is not surprising that Québec's homeownership rate is lower than Canada's," added Mr. Cardinal.
The opportunity cost of homeownership – meaning the additional monthly amount that a tenant household can expect to pay to become an owner household – also appears to have an influence on the homeownership rate. According to the QFREB's analyses, generally speaking, the higher the opportunity cost of ownership, the lower the homeownership rate. In fact, the difference between the costs associated with ownership and those associated with renting is often greater in Québec than elsewhere in Canada.
About the Québec Federation of Real Estate Boards
The Québec Federation of Real Estate Boards is a non-profit organization composed of Québec's 12 real estate boards and the close to 13,000 real estate brokers who are their members. Its mission is to support Québec's real estate boards in order to defend, protect and promote the interests of real estate brokers through the provision of services in the areas of professional practices, public affairs and market analysis. The QFREB is guided by an approach that is centred on collaboration and resource sharing.
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SOURCE Québec Federation of Real Estate Boards
Jacynthe Alain, Assistant Manager, Communications and Public Relations, Québec Federation of Real Estate Boards, 514-647-8249, [email protected]
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