Toronto: Rising Senior Homeownership

The homeownership rate for Toronto’s senior households could increase over the next decade, according to employment, income and other trends. Such a scenario would reduce the supply of family-oriented homes available for other generations.

Our latest Housing Market Insight (HMI) for Toronto looks at data on senior households from 2006 to 2016. We want to know what recent changes in senior households’ economic well-being and demographic characteristics can tell us about their future housing choices.

Seniors’ homeownership rate has increased since 2006

Between 2006 and 2016, the share of Toronto-area homes owned by senior households increased by 4.5 percentage points, reaching 25%. Townhomes were the housing type that showed the highest increase. In 2006, 11.5% were owned by seniors. In 2016, the figure was 17%. Some more highlights from the 2006 to 2016 period:

• Increases in seniors’ labour force participation resulted in greater income growth for their age group.
• The income difference between renter and homeowner senior households widened further. In 2016, the gap between their median incomes reached 130.4%.
• The proportion of senior renter households in core housing need edged lower. Still, it remained well above the proportion recorded for younger renter households.
• More seniors took debt into their retirement in 2016 compared to a decade before. However, seniors also had a much greater increase in net worth compared to younger generations.
• Stronger income and wealth growth provided senior households with access to a greater array of housing choices.

Rising homeownership could put a squeeze on supply

Historically, seniors have played a valuable role on the housing market by downsizing as they get older. In doing so, they free up family-oriented homes for younger households.

From 2006 to 2016, though, economic and demographic factors have caused seniors to decide, increasingly, to remain in their homes longer. This trend of rising homeownership among seniors may well continue into the future.  

If it does, it could put pressure on supply, since there may be fewer dwellings than expected available for younger households.