Long-time mortgage broker Callum Greig wasn’t surprised by census data released Wednesday showing a home with roommates is the fastest-growing housing type.
Young people buying their first condominium will often purchase a two-bedroom unit, not because they want the space but so they can bring in a roommate to help with the mortgage, said Greig, owner of Prime Mortgage Works.
“These are well-qualified people that can get into the mortgage, but they don’t want to necessarily pay the mortgage payment all themselves.”
While they only represent four per cent of all households in Canada, the number of roommate households climbed by 54 per cent from 2001 to 2021, Statistics Canada said.
At the same time, the share of people 35 to 44 years old who live alone doubled between 1981 and 2021, growing from five per cent to 10.
Greig attributes that partly to an increasing number of professional women, some of whom make six-figure incomes. “They can afford to live by themselves.”
Households made up of multiple generations of a family, two or more families, or one family living with people who were not relatives are also on the rise, growing by 45 per cent in the past two decades and representing seven per cent of all Canadian households.
Close to one million Canadian households in 2021 fell into that category.
Greig said he is seeing more inter-generational households in his business.
Homeowners will have parents living in their home, possibly in a basement suite. “Way more of that is happening today.”
In some cases, parents sell their home in another province with the idea of moving to the capital region to be closer to their adult children, but then find they can’t afford to buy a home in Greater Victoria.
So they give the money to their children as an early inheritance and move in with them, where they are closer to their grandchildren and can get help with the tasks of daily living, such as buying groceries.
On Wednesday, the Bank of Canada announced it was boosting its benchmark interest rate by one percentage point, bringing it to 2.5 per cent in an effort to put the brakes on inflation.
Greig predicts the rate increase will prompt would-be buyers to sit on the sidelines for six to eight months to see how the situation unfolds, causing a slowdown in the real estate sector.
“There’s no reason to panic. These rates aren’t forever.”
After the economic situation settles down in 18 to 24 months, Greig expects to see mortgage interest rates of about three per cent.
Brendon Ogmundson, chief economist of the Real Estate Council of B.C., said “overall, not a lot has changed” as a result of the Bank of Canada announcement.
A five-year fixed-rate mortgage has been based on expectations that the Bank of Canada’s interest rate will move to 3.25 to 3.5 per cent by the first quarter of next year, he said.
“Today doesn’t really change that. It might accelerate how quickly they get there.”
People can expect a five per cent fixed-rate five-year mortgage for the foreseeable future, he said.
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