Landlord’s Rental Boom Dreams May Be Relatively Short Lived
Landlords are experiencing a rental boom of sorts at the moment thanks to the last round of mortgage rules that may have put the dream of home ownership on hold for some Canadians. But, a recent Genworth pole indicates that this boom may be only temporary. Some Canadians, particularly those of the younger variety, refuse to give up that dream.
The survey was conducted with the help of the Canadian Association of Credit Counselling Services, or CACCS. Questions about financial health and preparedness were asked of 1,514 Canadians. Results showed that, contrary to what some analysts predicted, 56 percent of buyers getting into the market for the first time came up with a larger down payment than the 20 percent required. In the 2012 survey that percentage was 36 percent.
Genworth Canada’s CEO Brian Hurley attributed this to Canadians making the wise decision to save more before taking the home buying plunge. While it is a bit more difficult for some, home ownership is still held in high regard. The way that these new buyers are handling their mortgage debt is considerably more responsible than in the recent past. Hurley noted that this fact means that a soft landing on the housing market is more favourable than ever.
The 2013 survey showed that 50 percent of people thought it was more difficult to save for that down. In 2012 that figure was 55 percent. Some nine percent of first time home buyers thought it was easier to save the money in 2013, compared to the five percent in 2012.
At least one analyst has concluded that based on this data, landlords may be looking at a short-lived rental boom. This may cause landlords to reconsider hiking rents up too much lest they find their vacant units hard to fill. Some may still choose to up their rent as much as possible, knowing that the market, at least in the short term, can handle the excess.
Also noted on the survey was that only 17 percent of those asked considered now to be a good time to buy a home, even with the incredibly low interest rates. That does mean more rental business, at least for now.