Younger homeowners lack confidence in the face of mounting financial pressure, according to a recent report.
Millennials are relying on familial help to purchase a home more than any generation previously, according to Manulife Bank.
Nearly half – 45% — of Gen Y buyers received help from family when buying their first home; that’s higher than Generation X (37%) and Boomers (31%), according to Manulife’s most recent report, The debt truth: Unexpected expenses could spell big trouble for Millennial homeowners.
The report is based on an online survey conducted by Nielsen, which ran in February and included 2,098 Canadian homeowners. It found 25% of Millennial homeowners have no emergency savings and that 32% were “caught short” in paying their bills at least once in the past 12 months.
The study also found 70% of Millennials believe they are unable to manage a 10% increase in their mortgage payments.
“The truth about debt in Canada is that many homeowners are not prepared to adjust to rising interest rates, unforeseen expenses or interruption in their income,” Rick Lunny, President and CEO at Manulife Bank of Canada. “However, building flexibility into how they structure their debt can help ease the burden.”
The results speak to the importance of young homebuyers working with professionals – including mortgage brokers – to determine what mortgage product best suits their current and future needs.
“With higher home prices and larger mortgages, it’s more important than ever to find the Mortgage that’s right for you,” Lunny said. “A flexible mortgage that offers the ability to change or skip payments, or even withdraw money if your circumstances change, can help you ride out financial difficulties more easily.”
by Justin da Rosa 24 May 2017