A Bank of Canada study reveals that home equity savers are increasingly helping their children become homeowners, with the incidence of parents co-signing mortgages tripling over the past decade.“The impact of the affordability crisis is felt unequally,” stated the Bank's report. “Some parents can and often do help their adult children purchase homes.”The report, Housing Affordability And Parental Income Support, noted a significant rise in parental co-signing among first-time homebuyers, climbing from 4% in 2004 to 13% in 2022. “With parent co-signed mortgages, adult children on average enter the market at a young age with lower credit scores,” the report said.“How important are parents on co-signed mortgages?” researchers asked. “Our model shows parental support allows adult children to obtain more housing while still satisfying the regulatory borrowing constraints.”Canada's nationwide mortgage debt stands at $2 trillion, with the Bank estimating that 74% of adult children with co-signed home loans would not qualify for a mortgage otherwise. “House prices have more than quadrupled since 2000 with debt levels rising to over 180% of disposable income,” said the report. “As a result, entering the housing market is out of reach for many younger households.”The financial disparity is stark in cities like Vancouver, where “a borrower must have $212,800 in annual income to qualify for a mortgage on an average house while the median household income in Vancouver is just $83,600,” according to the researchers.A Statistics Canada analysis published on May 1 supports the Bank's findings, indicating that parents who accumulated home equity are passing on this advantage to their children. StatsCan referred to this as “the transmission of economic advantages from parents to children.”“Not all young Canadians have access to financial support from their parents, contributing to inequalities in access to home ownership,” said the StatsCan report, Intergenerational Housing Outcomes In Canada: Parents’ Housing Wealth, Adult Children’s Property Values And Parent-Child Co-Ownership.The report highlighted that the “positive association between parents’ housing wealth and the property value of their adult children” does not necessarily imply that parents were wealthy initially. Immigrant families were noted to share wealth from home equity more frequently. “Parents who are immigrants tended to co-own properties more frequently with their adult children than Canadian-born parents,” StatsCan reported. “Looking at all provinces and territories combined, almost half of co-owning parents were immigrants.”Further, data from the Canadian Imperial Bank of Commerce indicated that about 30% of first-time homebuyers received a cash gift from their parents, up from 20% a decade ago..This is what the Western Standard is up againstThe Trudeau government is funding lies and propaganda by directly subsidizing the mainstream media. They do this to entrench the powerful Eastern, woke and corrupt interests that dominate the political, social and economic institutions in Canada. Federal authorities are constantly trying to censor us and stop us from publishing the stories that they don’t want you to read. Ottawa may weaponize our taxes and police against us, but we’ve got a powerful ally on our side.You. Free men, and free women. We need you to stand with us and become a member of the Western Standard. Here’s what you will get for your membership:Unlimited access to all articles from the Western Standard, Alberta Report, West Coast Standard, and Saskatchewan Standard, with no paywall. Our daily newsletter delivered to your inbox. .Access to exclusive Member-only WS events.Keep the West’s leading independent media voice strong and free.If you can, please support us with a monthly or annual membership. It takes just a moment to set up, and you will be making a big impact on keeping one the last independent media outlets in Canada free from Ottawa’s corrupting influence.
A Bank of Canada study reveals that home equity savers are increasingly helping their children become homeowners, with the incidence of parents co-signing mortgages tripling over the past decade.“The impact of the affordability crisis is felt unequally,” stated the Bank's report. “Some parents can and often do help their adult children purchase homes.”The report, Housing Affordability And Parental Income Support, noted a significant rise in parental co-signing among first-time homebuyers, climbing from 4% in 2004 to 13% in 2022. “With parent co-signed mortgages, adult children on average enter the market at a young age with lower credit scores,” the report said.“How important are parents on co-signed mortgages?” researchers asked. “Our model shows parental support allows adult children to obtain more housing while still satisfying the regulatory borrowing constraints.”Canada's nationwide mortgage debt stands at $2 trillion, with the Bank estimating that 74% of adult children with co-signed home loans would not qualify for a mortgage otherwise. “House prices have more than quadrupled since 2000 with debt levels rising to over 180% of disposable income,” said the report. “As a result, entering the housing market is out of reach for many younger households.”The financial disparity is stark in cities like Vancouver, where “a borrower must have $212,800 in annual income to qualify for a mortgage on an average house while the median household income in Vancouver is just $83,600,” according to the researchers.A Statistics Canada analysis published on May 1 supports the Bank's findings, indicating that parents who accumulated home equity are passing on this advantage to their children. StatsCan referred to this as “the transmission of economic advantages from parents to children.”“Not all young Canadians have access to financial support from their parents, contributing to inequalities in access to home ownership,” said the StatsCan report, Intergenerational Housing Outcomes In Canada: Parents’ Housing Wealth, Adult Children’s Property Values And Parent-Child Co-Ownership.The report highlighted that the “positive association between parents’ housing wealth and the property value of their adult children” does not necessarily imply that parents were wealthy initially. Immigrant families were noted to share wealth from home equity more frequently. “Parents who are immigrants tended to co-own properties more frequently with their adult children than Canadian-born parents,” StatsCan reported. “Looking at all provinces and territories combined, almost half of co-owning parents were immigrants.”Further, data from the Canadian Imperial Bank of Commerce indicated that about 30% of first-time homebuyers received a cash gift from their parents, up from 20% a decade ago..This is what the Western Standard is up againstThe Trudeau government is funding lies and propaganda by directly subsidizing the mainstream media. They do this to entrench the powerful Eastern, woke and corrupt interests that dominate the political, social and economic institutions in Canada. Federal authorities are constantly trying to censor us and stop us from publishing the stories that they don’t want you to read. Ottawa may weaponize our taxes and police against us, but we’ve got a powerful ally on our side.You. Free men, and free women. We need you to stand with us and become a member of the Western Standard. Here’s what you will get for your membership:Unlimited access to all articles from the Western Standard, Alberta Report, West Coast Standard, and Saskatchewan Standard, with no paywall. Our daily newsletter delivered to your inbox. .Access to exclusive Member-only WS events.Keep the West’s leading independent media voice strong and free.If you can, please support us with a monthly or annual membership. It takes just a moment to set up, and you will be making a big impact on keeping one the last independent media outlets in Canada free from Ottawa’s corrupting influence.
