New figures have shown that many Canadians close to their retirement age may be tempted to sell, providing a wealth of new property investment options for foreign buyers. In a poll commissioned by Re/Max, it was revealed that many people want to access their home’s equity as they leave work, with 56 per cent wanting the money for retirement purposes. This could offer new buying options for those seeking investments.
Conducted by Leger, the poll focussed on Canadians approaching retirement age and questioned people on their plans for their home. The majority said they were interested in selling up so they could access vital funds to retire on. However, many didn’t know where they would move to, especially those currently living in Toronto and Vancouver.
In a press release, Re/Max said: ‘The competition in both Vancouver and Toronto among buyers has discouraged sellers from listing their properties, thus further reducing inventory. While sellers know their homes would be quick to sell, many are reluctant to become buyers themselves and enter the highly competitive market.’ Meanwhile, despite some homeowners expecting to see further rises in the market, many simply cannot wait and will be forced to sell their homes to fund their retirement.
Vancouver and Toronto remain the strongest real estate markets in Canada for current price appreciation. During the first quarter, Greater Vancouver saw a 24 per cent rise in value when compared to the same period a year ago. It means that the average single family home in the region now costs over $2m. Meanwhile, the average price in Greater Toronto is now $675,492: a 14 per cent rise on the first quarter of 2015. There was also a 14 per cent rise for property prices in Barrie, Ontario.
‘The ripple effect on the housing markets outside of Toronto and Vancouver is quite significant when you look at the Canadian housing market overall,’ Re/Max’s Western Canada regional executive vice-president, Elton Ash, said. ‘As a result, when you remove Toronto and Vancouver from the equation, the national average house price still rose approximately 10 per cent in the last year.’
Some Canadian areas have been affected by the slump in oil prices. For example, Edmonton, St. John’s and Calgary have seen dropped property values. However, Re/Max maintain that economic diversification combined with large capital infrastructure projects have helped limit the fallout. In fact, some areas have actually benefited from the energy market’s crisis. This is because some workers have left the energy industry and moved back to their original provinces. This is true of Atlantic Canada, where youngsters traditionally gravitated to Alberta. However, many are now seeking out work in Halifax, resulting in an upswing for the local economy.
Overall, the price of property in Canada continues to climb, despite some regional discrepancies. And, with many of those reaching retirement age being forced to sell homes to help fund life after work, there could be a greater number of opportunities for savvy foreign investors to get great homes for both short-term and long-term returns.