It’s no secret that first-time homebuyers in B.C. face an uphill battle when it comes to finding a property.
A new study from Statistics Canada is showing just how much they pay in comparison to repeat buyers and the increase in first-time buyers despite high prices.
“The 2020 housing market is mostly remembered for the onset of unprecedented increases in housing prices in some areas, it was also characterized by a sharp increase in the number of first-time homebuyers in certain provinces and territories,” said the Dec. 8 report.
In B.C., the number of first-time buyers reached 25,315. This is a 28 per cent increase over 2019 levels and 30.5 per cent above 2018.
“First-time homebuyers are of particular interest because they are likely to have had less initial equity to purchase their home, compared with repeat buyers, and may be more vulnerable to affordability challenges,” said the report.
Those who purchased in 2020 and opened five-year mortgages at fixed rates of roughly two per cent may face renewing at a much higher rate in 2025, “if current rates prevail, further exacerbating affordability concerns.”
First-time buyers in B.C. paid a median price of $530,000, which was $100,000 less than the total paid by repeat buyers in 2020. Differences in location and housing type are responsible for this discrepancy, according to Statistics Canada.
In B.C., 62.5 per cent of first-time buyers bought condominium apartments and row houses.
Provinces such as Nova Scotia, New Brunswick and Manitoba have first-time buyers who prefer single-family homes and as a result the median price paid by these buyers is higher than that of repeat buyers.