Monday, 8 September 2014

Homeownership gap between starter, dream residence widens

Otmane El Rhazi from CBC | Business News .


It’s getting harder for young families to move up from their first home to a mid- or higher-priced one because of the widening gap between starter and dream homes, according to a new report from CIBC World Markets.

In already expensive housing markets such as Toronto, Vancouver, Calgary, Edmonton and Ottawa, the mid- to high-priced homes are rising in price more quickly than cheaper homes, CIBC deputy chief economist Benjamin Tal says after studying housing data from across Canada.
Most Canadian couples assume they’ll start out in a smaller home, or possibly a condo, sometime in their 20s or 30s, then move up to a larger home as their family grows, Tal says.
"However, there are many indications that this cycle that dominated the Canadian housing market for decades is breaking," Tal says.

In the lower-price ranges, the Canadian housing market has cooled, in part because of measures taken by the federal government to make it harder to qualify for a mortgage. An abundant supply of new condos also prevents prices from rising quickly in this segment of the market, the CIBC report said.

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