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How Many MORTGAGE FREE Households are in Vancouver and Toronto?

Which city in Canada has the highest real estate prices?

You got it, Vancouver.

Then do you know which city has the highest percentage of households without a mortgage?

Vancouver as well.

What is the percentage of homeowners who are mortgage-free?

The number is shockingly high.


So half of the homeowners in Vancouver are mortgage free.

What is the percentage in the second most expensive city, Toronto?

43% homeowners in Toronto are mortgage free.

In Calgary, it is 35%.

These numbers came from a recent census analysis provided by Simon Fraser University.

You see, these numbers explain why real estate prices have stabilized for a few months already even though the interest rate is still hiking.

Almost half of the households in Vancouver and Toronto are unaffected by the interest rate because they simply don’t need to make any mortgage payments!

Some people might jump to the conclusion and say “See, that’s because of the investors!”.

But if you are a true investor, you know that paying off the mortgage is the least thing you want to do.

We always want to pay as little down as possible and get as many mortgages as possible, so we can maximize the leverage.

So the majority of the mortgage-free people are actually end-users.

Canada is such an equity wealthy country.

This is one major reason why the Canadian real estate markets have been so resilient going through different kinds of crises.

What role do investors play in the real estate market then?

Investors often get blamed for pushing prices up.

That’s understandable because 1 in 5 properties across much of Canada is owned by an investor, so around 20%.

The percentage is even higher in the condo segment.

In Toronto, 36% of the condos are owned by investors.

The percentage goes up to more than 86% in university cities like London, where investors are attracted by the student rental opportunities.

Investors may have some responsibilities pushing prices up.

But ultimately, prices go up because of the basic economic principle, demand exceeds supply.

Because in the end, if there is no demand for housing units, the investor owned units will be sitting vacant.

With no rental income, investors would definitely quit.

So if we cannot stop demand, the only way to stop prices from going up is to increase supply, very simple, right?

Let’s suppose we ban all the investors because we think they are jacking up the prices.

Now, all the opportunities are open up to end-users only.

They rarely buy pre-construction projects because who wants to wait 5 years before you can move into your home?

So developers can’t sell their projects, they don’t get funding and they cannot start construction.

Now, private developers are dead.

Who’s going to build the units?

The only one left is…

The Government.

So the government is going to spend all that money to build all these projects and then sell them to end users at low prices so housing is now affordable for everyone.

But let me ask a question.

Where does the government’s money come from?

You, the taxpayer.

Are we saying that everyone is going to pay more taxes so the government has the money to make housing affordable for everyone?

Besides, it is very likely that it will take the government much longer to build than private developers.

As a result, we are going to see a substantial decrease in housing supply.

The supply and demand gap gets even bigger.

So prices would actually jack up even more if investors are all banned.

Just basic economics.

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