Parents’ property ownership influences the likelihood of homeownership for their adult children

House and condominium apartment prices in Canada have increased markedly in recent years. This has led to rising concerns about the accessibility of homeownership, especially among younger Canadians.

Having a home isn’t just a basic need, it is essential to our health and well-being. Despite its importance, challenges in affordability, among other factors, can make it difficult for many people in Canada to find a safe and stable home.

In 2021, 56% of people reported being very or somewhat concerned about whether they could afford housing or rent.

Homeownership in Canada has been on the decline after hitting its peak in 2011. Canadians overall were less likely to own their home in 2021 (66.5%) than they were a decade earlier, when a record high 69.0% were homeowners.

There are many factors that contribute to the ability of younger Canadians to become homeowners.

The study released on November 20, 2023 titled “Parents and children in the Canadian housing market: Does parental property ownership increase the likelihood of homeownership for their adult children?” addresses the question of whether the adult children of homeowners are more likely to be homeowners themselves.

Results reveal a link between parents’ wealth and their adult children’s homeownership outcomes.  

Overall, parents’ property ownership remained positively associated with their adult children’s likelihood of homeownership when holding constant the adult children’s income, age and province of residence.

In 2021, the adult children of homeowners were twice as likely to own a home as the adult children of non-homeowners. Adult children whose parents owned multiple properties were nearly three times more likely (23.8%) to be homeowners in 2021 as the adult children of non-homeowners. 

The majority (52.8%) of people born in the 1990s who own multiple properties also have parents who own multiple properties. Of adult children who owned multiple properties, 10% had parents who were not homeowners in 2021.

This higher rate of homeownership among adult children of parents who owned property increased with the number of properties their parents owned.

This positive association between the homeownership rate of adult children and their parents’ property ownership was greatest for adult children with individual incomes of $80,000 or lower. For example, among those with this income level born from 1990 to 1992—the oldest cohort studied—the rate of homeownership was 27.4% for the adult children of homeowners, nearly two times higher than for the adult children of non-homeowners (14.8%). For those of the same age with incomes above $80,000, the rate of homeownership was 56.4% for the adult children of homeowners, around one-fifth higher than for those of non-homeowners (46.2%).

Financial assistance from parents is one of the factors that can explain differences in homeownership between the adult children of homeowners and non-homeowners. Other possible factors include better access to certain social networks and greater investments in education, which may lead to higher individual incomes for adult children of homeowners.

This is the first article in a series investigating intergenerational housing outcomes in Canada. For further analysis and additional data, read the full report titled, Parents and children in the Canadian housing market: Does parental property ownership increase the likelihood of homeownership for their adult children?

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