RateSupermarket.ca released findings from its Terrible Money Twos survey on Tuesday highlighting the difficulty Canadians of all ages are having balancing family creation with home ownership.
According to the survey millennials are the hardest hit with 72% of younger people indicating high real estate prices are directly affecting their ability to choose both.
"While it's no surprise that kids are hard on the wallet - at a quarter of a million dollars to raise a baby to college-age - it is disheartening Canadians increasingly feel they must choose between home ownership and their desire to be parents," said Penelope Graham, Editor at RateSupermarket.ca. "Rising home prices, especially in Canada's urban centres, are making it tougher for millennials to follow their family dreams."
The survey, which polled 1,700 Canadians, looked to understand how housing costs, childcare and existing household debt all play a role in family affordability, or the lack thereof.
Here are some of the key findings:
- 54.5% said family costs were more than they anticipated
- The price of food topped the list of unexpected costs for parents at 26.5%
- 52.8% of respondents say they cannot start or expand their family in their current home
- 49.4% of respondents say they have changed their minds about their desired family size due to associated costs
- 71.4% of millennial respondents say they would need to make significant financial changes before starting a family, led by increasing savings at 41%
Does anything stand out for advisors among the five points listed above? Anything?
According to the survey 53% of the respondents indicated they couldn’t start or expand their family in their current home. While the findings don’t suggest some of the reasons why those who answered this way felt they couldn’t but an obvious explanation would be they don’t believe they have enough space where they’re currently living hence why they’re considering a real estate purchase in the first place.
The American Enterprise Institute provides some insight into why people might feel they don’t have enough space.
In 2013, the median size of new houses in the U.S. was 2,491 square feet. Forty years ago the median size of a new home was 1,525 square feet, 40% smaller than today. Meanwhile the number of people living in households has dropped from 3.01 persons per household in 1973 to 2.54 in 2013. The average amount of living space per person has almost doubled in the last 40 years.
So, is it housing prices that are to blame, or our desire for more space, that makes balancing family life and home ownership so difficult to achieve?