Millennial real estate market
Why downtown is an attractive market for first-time homebuyers
By Maya Abdallah
Edmonton condo specialist, Jakie Ng, has been in the real estate business for 12-years and has seen a lot of “doors being built” in the developing downtown area.
“If you’re looking for potential buyers, certain demographics are more inclined to looking right now,” Ng says.
Homeownership downtown is at 24.41% in comparison to 49.78% in the entire city, in the 2016 Census data recorded by the City of Edmonton. Homeownership is on the rise and millennials are helping shape that shift, Ng says.
Ng mostly sees potential home buyers around the age of “ 26-35” in the downtown region, where he normally operates from.
Colleen, 27, and Mark Miller, 31, own a property downtown. Mark was studying at MacEwan University and wanted to try something new, outside of his small hometown, when he purchased his home just over seven-years ago.
Mark’s reason for buying a home was to “build some equity rather than paying someone else’s [rent].”
Veteran Realtor, Stephen Lau, of Edmonton Home Pros Real Estate Group says there are always young people buying homes for different reasons.
“When you rent you’re actually paying a landlord and you’re making him rich. When people can qualify for their own property, they tend to buy property as soon as they can so they stop paying rent.”
As for young married couples “they want to have control over their future. If you’re a tenant, you can get kicked out at any time,” says Lau. In terms of moving out at any time and renovations, “the tenant does not have 100% security.”
Considering the current economy, people cannot afford expensive properties.
“There’s been a mortgage stress test for the last two years, which is making affordability harder. People have to put more money down to qualify for a house,” says Lau.
Regardless, young adults are still buying.
20-year-old University of Alberta student, Daniel Bailey, has worked several jobs in order to afford buying his new home. While studying part-time, he also manages the ATB Capilano branch.
Bailey will take possession of his home, in Oliver, on February 21.
“I’ve had great family members help me make responsible decisions with my money,” Bailey says. “The process was fairly straightforward because I did my research as well as surrounded myself with a great realtor (Heather Morris) and a brilliant mortgage broker (Angela Epp).”
Bailey has had a “terrible experience” with renting downtown in the past. He wanted to take advantage of attaining good assets with cheaper market prices at a young age.
“Because I put a good amount down, my mortgage is much cheaper than my rent was. I also wanted the opportunity, in a couple of years, to take advantage of the equity in my home for example, getting home equity line of credit (HELOC) on my property for a down payment on another property.”
Ng predicts that the rental market is expected to increase which could ultimately have a positive impact on local business along 124 Street and Jasper Avenue making downtown “attractive”overall.