Young adults really do have it harder today, and what this means for Canadian Millennials
Blogger: Jaime Morrison
Rob Carrick’s recent columns in the Globe and Mail discuss how Canadian young adults may be getting a “raw deal” in today’s economy. Carrick discussed the interplay between the minimum wage, tuition fees and high unemployment facing Canadian Millennials today. In Monday’s article he explained how house price gains in excess of inflation make it harder for new buyers to get into the market.
Citing the Canadian Real Estate Association if house prices had kept up with inflation since the 1980’s the average house in Canada would cost $154, 587, where in April this year the actual average cost of a home was $397, 677. And while in the 1980s the cost of a house might have been 1.6 times a family’s annual income it is now a multiple around 6 times the annual income.
This leads us to consider, will this have a lasting effect on the Canadian Millennials? According to a recent study we found that many young Canadians hold home ownership high on their list of priorities. Our November 2011 National Survey asked Millennials to rank a list of seven top priorities. On average, Canadians across generations and including Millennials, hold owning their own home among their top three priorities.
|Gen X Priorities
1. Success in a marriage or relationship
|Baby Boomer Priorities
|The Great Generation
Abacus Data National Survey, November 2011
While owning a home remains a high priority for members of the Great Generation, Millennials are on par with Gen X and Baby Boomers when it comes to owning a home, ranking as the third priority across these demographic groups, on average.
As of last fall 23% of Millennials reported that they owned their own home or condo, 48% reported that they were renting an apartment and 29% of Millennials aged 18 and older were still living with their parents or family members, rent free.
In his recent book, How Not to Move Back in With Your Parents, Rob Carrick discusses the difficult decision Millennials will face when trying to balance debt and home ownership.