More immigrant families who have been in Canada for more than 20 years are investing in real estate now than Canadian-born families, new data from Statistics Canada (StatCan) released on Tuesday showed.
In 1999, Canadian-born families accounted for 56.4% of homeownership in the country, while immigrant families only accounted for 31.2%. However, in 2016, the immigrant homeownership rate (78.7%) outpaced that of native-born Canadians (74%), according to StatCan data.
Howard Ramos, political sociologist at Dalhousie University in Halifax, said that it’s not surprising to see immigrants being more eager to climb the housing ladder than putting their money into other things.
"Many people may not be getting RRSPs or other investments, because they may be self-employed or have had career disruption when they came to Canada, which leads them to the one asset they can control — homeownership,” Ramos told CBC. "The evidence shows that this as a strategy has paid off in the past and is still paying off for newcomers today.”
Immigrants’ preference for housing as an investment may also be a factor in their willingness to borrow. Established immigrant families had a debt-to-income ratio of 2.17 in 2016, while Canadian-born families had 1.32.
"Most of the difference was due to the larger mortgages carried by immigrant families," StatCan said.
Meanwhile, Jelena Zikic, associate professor at York University’s school of human resource management, said that immigrants “have a mindset of being safe and secure,” so seeking to climb the housing ladder makes sense.
"Most of the migrant motivation has to do with 'I want my kids to be better off,’" Zikic said. "There's a fear of losing their ground in a new place, so they see [tangible investments] as a way to protect themselves."