To see how Canada’s housing market is evolving, take a look at the National Household Survey (NHS), part of the 2011 Census that was recently released by Statistics Canada.
The survey shows that while Canada’s homeownership rate has remained at about 69 per cent during the last decade, the market is shifting. Condominiums are taking an increasing market share and first-time buyers are driving the market. But as the country has enjoyed a robust real estate market for the last decade, house prices have driven many Canadian homeowners to spend more than they can afford on housing costs.
Four of out five "couple families" - defined as one married couple or a couple living common-law, with or without children - own their homes, while just 48.5 per cent of non-family households are owners.
The highest homeownership rate is in Newfoundland at 77.5 per cent, while the lowest rate among the provinces is Quebec at 61.2 per cent. The far north - Nunavut and the Northwest Territories - have the lowest homeownership rates in the country.
Most Canadian households live in single-detached dwellings (55 per cent), with row houses, semi-detached houses, duplexes, movable dwellings and other single-attached dwellings accounting for just 17.8 per cent of total households. About a quarter of households live in apartment buildings.
However, about 20 per cent of those who bought a home between 2006 and 2011 purchased a condominium. There were about 1.2 million owner-occupied condos in Canada when the Census was taken, but almost half of those owners moved in during the five-year period of the Census. A look at the construction sites in any Canadian city shows that many more people will be living in condos when the next Census takes place.
The NHS says households in which the "primary maintainer" - the person responsible for paying the rent, mortgage, taxes and utilities for the home - was 35 or less were more likely to own a home than rent, if total household income was $60,000 or more.
Overall, households where the primary maintainer is 35 or less has an ownership rate of 46.9 per cent. Ownership rates rise as the age of the primary maintainer rises. Those aged 55 to 64 have an ownership rate of 77.1 per cent, and those aged 75 and older have an ownership rate of 70.5 per cent.
First-time owners are critical to the real estate market. Of all the households that bought a home between 2006 and 2011, almost one-third had a primary maintainer under 35-years-old.
You can see why the real estate market has been so active when you look at the number of people who bought or built a home and moved during the five-year Census period. Of the 9.2 million owner households in Canada, about 2.6 million or 28.1 per cent moved into their home during that time. The majority of homebuyers came from the immediate neighbourhood, while 41.4 per cent moved from outside the area.
Calgary had the largest proportion of owner households that moved at 35.8 per cent, while Windsor, Ont. had the smallest proportion at 20.4 per cent.
Four out of five home-buying households had a mortgage, which was higher than the proportion of households that did not move (50.3 per cent).
The NHS reports that in 2011, the average monthly shelter cost paid by all households (owned and rented) in Canada was $1,050. Owners paid an average shelter cost of $1,141 while renters paid $848. The highest shelter costs were in Toronto ($1,366) and the lowest was Trois-Rivières, Que. ($697).
About 25 per cent of households, or 3.3 million, spent more than 30 per cent of their total household income on shelter costs. Canada Mortgage and Housing Corp. and the provinces say 30 per cent of total household income is the threshold at which housing costs become unaffordable.
Of those 3.3 million households, 1.7 million were owners and 1.6 million were renters. Vancouver, which has led the country in real estate prices for several years, had the largest proportion of households paying more than 30 per cent of total income for shelter costs, at 33.5 per cent. Saguenay, Que. had the lowest proportion at 18.9 per cent.
Of the households that exceeded the 30 per cent threshold, owners paid an average of $1,583, which was $617 per month more than the threshold. Renters paid $928, exceeding the threshold by $403 per month.
Of all homeowner households, about 58.6 per cent have a mortgage. The average shelter cost for houses with a mortgage was three times higher than that of households that are mortgage-free - $1,585 per month compared to $511 per month.
Mortgage interest rates have been at historically low levels for several years but are expected to rise gradually during the next few years. Anyone purchasing a home now should make sure they "stress-test" their mortgage to make sure they will be able to afford it if rates go up by renewal time.