James Newcombe, 83, stayed in his roomy home in Georgetown, Ont., as long as he could.
The retired pilot and his wife bought the four-bedroom house in 1982 after moving from another home in the same subdivision. They stayed for years as empty-nesters after their three children moved out, until his wife’s declining health required a move to a retirement home last year.
“The bedroom was on the top floor at home and she couldn’t handle the stairs,” Mr. Newcombe said.
There was no room for the two of them at the facility they preferred locally, so they ended up leaving their friends and long-time community behind and moving to Dundas, Ont., a small town within Hamilton’s boundary, about 60 kilometres south of Georgetown.
“It’s a little hard to move away,” he said. “I would have stayed in the house if we could have,” noting that many of his friends are still in their houses.
Mr. Newcombe’s desire to stay in his family home as long as possible is increasingly par for the course, and the age at which elderly homeowners sell is going up. A Canadian Mortgage and Housing Corporation report in November found that the sell rate for each five-year age cohort for those aged 75 and over has been trending downward since the early 1990s, putting increasing pressure on the housing market.
The report, titled Understanding the Impact of Senior Households on Canada’s Housing Market, said the sell rate among that age group has fallen about six percentage points in the past 30 years.
Seniors are now less likely to sell their homes before age 85, it said, noting the demographic shift needed to free up a meaningful amount of housing stock won’t start happening for several years. “According to Statistics Canada’s demographic projections, population growth in the 85-and-over age group will be higher from 2030 to around 2040.”
CMHC economist Francis Cortellino wrote a large part of the report, and said “better health and better wealth” is part of what is keeping people at home longer, but so is a lack of options. Those who would be willing to downsize, he said, are often stymied by a lack of housing variety in their communities, so they stay in their homes to remain close to their friends.
“Solutions aimed at increasing supply from existing units (by creating secondary suites or laneway homes, for example) could be increasingly considered.” the report said.
Mr. Cortellino said that in many of Canada’s large cities, seniors living alone or couples over age 75 are more likely than young families to live in single-family homes with three or more bedrooms. (A Globe and Mail analysis of 2021 census data found the percentage of singles and couples who live in homes that have a minimum of three bedrooms increased to 29 per cent that year, from 26 per cent in 2006.)
He said he’s found anecdotally that many people are instead “downsizing from the inside” – only using a small part of their house, often the ground floor, and often closing off or limiting heating in the rest.
Several other reports confirm parts of his findings. Real estate and mortgage company Redfin published a report in January that found that in the United States, “empty-nest baby boomers own 28 per cent of the nation’s large homes [with three or more bedrooms], while millennials with kids own just 14 per cent.”
A September paper by University of Waterloo and McMaster University researchers states seniors are most likely to leave their homes for a retirement home only when access to home care and other services become a challenge. And a Deloitte report from 2022 found “91 per cent of Ontario seniors hope to stay in their own home for as long as possible.”
Real estate economist Diana Petramala wrote a report on the issue in 2018, which posited that “those waiting for baby boomers to downsize may be holding their breath for some time. Boomers are not expected to downsize in a meaningful way until mid-2040.” It noted that while millennials now outnumber boomers, boomers still own more homes, and forecast a deficit of 70,000 “ground-related housing units” this decade to meet millennial demand.
She adds that there’s also a cultural element: Canadians are very driven by home ownership.
“People highly value their homes, not just as an asset, but as a place where they live,” said Ms. Petramala, who is based in Toronto.
The cost of moving – especially for someone living in a home that is paid off – is also a barrier to many seniors who would otherwise consider downsizing, said Julia Chung, certified financial planner and co-founder of Spring Plans in South Surrey, B.C. Other expenses include preparing one’s house for sale, disposal of unwanted items, staging, packers and movers, real estate agent and lawyer fees, property transfer taxes and potential condo fees or monthly fees at a retirement home to consider.
“Moving costs will be higher than most people expect,” Ms. Chung said. Among her clients who are staying in their homes instead of downsizing, “either they find that they would not have the net financial gain from downsizing that they’d expected, or they even might find that it costs more for this smaller home because of the location, amenities, age, and of course, the market that wants the same thing.”
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