McClelland Minute - February 7, 2010

Demographic Trends That Will Influence Real Estate

A college professor once said at a conference I attended that if you want to predict the future, seek to acknowledge the past and understand the present.  This particularly applies to changes in population within our region and the country as a whole. 

Immigrants will continue to shape Canada as it has been the practice for the past three hundred years. Our country needs more labour than it can presently raise on its own, so we invite hardworking peoples from offshore.  Many will stay to raise their families and further create multi-cultural societies in our communities.  Personally, as a grandson of immigrants, I believe this will only make us all stronger.  Many of these families live together in multi-generation households and prefer to cluster with others of similar nationality.  I am always impressed by their willingness to sacrifice in order to get that first home, even if sometimes they don’t have the means to furnish properly at the outset. 

Baby boomers, age 55 +, are still making an impact by downsizing from their large suburban homes into one or even two smaller condos.  They don’t seem afraid to pick up and move either, sometimes to be closer to family, or warmer climates.  Friends of mine retired from their jobs in Saskatoon, bought a new ranch style home on a golf course in Phoenix, and kept their modest cabin at the lake.  They think they have the best of both worlds and maybe they do.

Some in this age bracket however feel trapped by the market downturn, the need to continue working, or health issues.  Too many look at their spouse, see nothing in common, and decide to call it quits.  This often creates deep divisions within families and lifelong friends, making for an unhappy entry into the “golden age”.  As single income individuals the attainment of suitable housing becomes quite difficult adding further stress into their life.

The age 35 + group is probably the most difficult to pin down in my mind.  They are either aggressively using real estate to build wealth or have settled into a comfortable setting with no plans for changing their home in the future.   The traders see each house simply as a step to the next bigger / newer one with the goal of increased equity each time.  Their counterparts are more likely to steadily pay down the mortgage on the family home, like their parents did before them, and become committed to a neighbourhood or community.

This, of course leaves the twenty somethings.   What a dynamic crew.  They have a pretty clear idea about how to get what they want.  They have been raised to be self-sufficient; after all if you need information, just google it or ask your network of friends.  When they are searching for that first home, technology and people behind it must respond quickly or they will move on.   This age group is setting the pace in real estate in a very real way, the others are watching and learning.

As Realtors we serve them all.  Each demographic brings something to the table – enthusiasm, wisdom, experience, values.  I wouldn’t have it any other way. 

Vern McClelland is associate broker with RE/MAX of Lloydminster.  If you have questions or comments on this article or other real estate matters, he can be reached at 780.808.2700 or through the McClelland Group website www.mcclelland.ca

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