“Bob Rennie says Metro Vancouver baby boomers have clear title to $197 billion worth of residential real estate”. Bob Rennie a Vancouver condo marketer presented his annual numbers to the Urban Development Institute at the beginning of June. The amazing thing is that this $197 billion number is up from $66 billion in 2006.
What this means is that the Bank of Mom and Dad are helping their children get into the real estate market often by-passing lending institutions.
Article by Charlie Smith on June 2nd, 2016 in Georgia Straight
“In a one-hour speech, Rennie said that 193,000 homes in Metro Vancouver are owned “clear-title” by someone over 55 years old.
The value of these residential properties is $197 billion. That’s up from $66 billion owned clear-title by the region’s baby boomers in 2006.
Rennie noted that $60 billion of the $197 billion of clear-title property is owned by people over the age of 75. He suggested that these equity-rich boomers are trading down and buying second homes or recreational properties. In addition, he said that they’re helping their children and grandchildren enter the market.
“The Royal Bank of Canada is tracking first-time buyers,” Rennie stated to a full house in a Fairmont Hotel Vancouver ballroom. “Eighty percent-plus of their Vancouver first-time buyers are receiving family funds, 70 percent-plus in Burnaby, and 60 percent-plus in Surrey.
“The $197 billion is fuelling Victoria, but it’s also in Kelowna, on Bowen Island, and at Whistler,” he continued.
Rennie predicted that a coming wealth transfer from baby boomers to their children is going to have a profound impact on the housing market in the coming years.
“I see a wealth-transfer tax coming by 2020—and a huge rush to transfer wealth by the living rather than by the dead,” he forecast. He pointed out that the regional homeownership rate of 65 percent is on par with the national average of 66 percent in metropolitan regions. And it’s far higher than the 56.4 percent homeownership rate in the region in 1986 when Vancouver hosted a World’s Fair.
Rennie also said that it’s a myth that millennials are leaving Vancouver, noting that the number of 20-to-34-year-olds rose 9.5 percent in the city between 2005 and 2015.