The Altus Group recently published a short paper that profiled new home buyers across Canada. Admittedly, hard data are scarce, with the best information coming from major urban centres. However, the observations ring true across the country.
Approximately one in 100 households, or one per cent, purchased a newly built home during the most recent five year period studied (2006 - 2011). Approximately four per cent of all households bought a home (new or resale) over the same period. The most active period percentage-wise for new home purchases versus total home sales was 1986 to 1991. The 20 ensuing years were fairly consistent.
As anticipated, home buyers under 45-years old accounted for almost 60 per cent of all home purchases with new homes and existing home percentages being similar. This statistic emphasizes the significance of the first-time buyer who would fall within this demographic.
Those over 55 accounted for 20 per cent of sales.
Although couples with children still account for the majority of new home sales, their percentage has declined from 57 per cent in the 1986 to 1991 period to 44 per cent in the 2006 to 2011 period. The greatest growth sector has been the single new home buyer, a group that has doubled in size over the same period.
Who are these people? Well, one in four are over 55. More than half have incomes of less than $60,000. Again, this is a very important group as it represents the first-time home buyer who sees a need to get into the market now, when mortgage rates are low and home values continue to increase. Half of these purchases were single family homes, debunking the premise all single buyers are looking for apartments or condominiums. This group is also split evenly between males and females.
To no one's surprise, couples with children overwhelmingly opt for single family detached homes.
A significant number of new home buyers in Canada purchase their homes in the same local municipality or area where they were already living. Although not substantiated with data, if we were to apply this premise to Winnipeg, we could argue that many of those buying new in Transcona, St. Vital or Ft. Garry already live in those neighbourhoods and are looking to upgrade their housing while still remaining close to the amenities they currently enjoy.
Although the above research was collected nationally, I don't see anything that couldn't be applied locally to the Winnipeg and Manitoba markets.
Mike Moore is president of the
Manitoba Home Builders' Association
