The Dream of Home Ownership is Alive and Well
A recent survey released by Genworth Canada reveals that to own a home, Canadian “homebuyers are working harder and longer to save for a down payment….” Canadians again see homeownership as achievable. They not only recognize the long-term value of owning a home, they believe it contributes to their financial and emotional well-being. The numbers confirming this are quite high.
9 out of 10 Canadians:
- “…agreed that owning their own home gave them a greater sense of emotional well-being,
- “…thought homeownership may mean more work and effort, but would rather own their home than rent.”
- 64% of respondents felt that “housing prices will increase in the next 12 months”, and
- 53 percent are worried they might miss the perfect house because they don't have enough saved for the down payment.
Canadians do prize homeownership.
Affects on Financial Well-Being
As a first benefit homebuyers are recognizing that owning a home contributes to their financial health and security in a number of ways. Without question, real estate values are subject to cyclical ups and downs. Long term though, home values do rise. Between 1981 and 2012, Canadian residential home prices grew on average by 5.2% per year. Even from the start of the recession in 2008 until now, home prices in the Niagara Region point to an overall average increase, though modest, of 2.87%% per year. This contributes to growth of equity.
As a second benefit, mortgage debt decreases over time further increasing equity. According to Genworth, 67% of Canadians have a goal of paying off their mortgage faster than the amortization on the mortgage.
Third, if you were to sell your principal residence, you would not pay taxes on the sale price or the equity--great for retirement planning.
Affects on Emotional Well-Being
The Merriam-Webster dictionary defines well-being as “the state of being happy, healthy or prosperous.” Such positive advantages can definitely be gained through the financial health, security and comfort of homeownership.
Homeowners also value their pride of ownership, the stability of knowing they don’t have to move, the flexibility to create an environment that suits their individual needs and tastes, and a feeling of permanence and involvement. Ownership also gives a sense of belonging to the community.
Saving for a Downpayment: 17% of all buyers and19% of first-time homebuyers say now is a good time to buy a home. Half expect it would take 1 to 2 years to save up for a downpayment and 29% say 3 to 4 years.