The latest survey from Canada’s state-owned mortgage insurer reveals that the kids are not alright. CMHC data shows first-time purchasers increasingly depend on non-traditional funding such as non-mortgage debt, gifted down payments, and co-ownership with non-occupying residents. First-time buyers are showing more signs of being overextended despite increased leverage. Young adults are finding themselves in an environment that increasingly resembles Victorian-era feudalism, where generational wealth is required for basic stability.
Canadian First-Time Home Buyers More Reliant On Non-Mortgage Debt
Canadian first-time home buyers are now more reliant on non-mortgage debt to buy a home. Only half (50%) of recent buyers were able to cover unexpected costs like repairs, legal, or inspections. It’s a stunning drop from the 78% a year before, as more people turn to credit cards and lines of credit to cover these expenses.
The results don’t just indicate that first-time buyers are increasingly overextended and vulnerable to shock. This debt fueled approach is a drag on future productivity: Every dollar borrowed today (plus interest) means less economic activity tomorrow.
Over 2 In 5 First-Time Home Buyers Used A “Gift” For a Down Payment
Speaking of overextended purchases, gifts are becoming a more important part of purchasing. Over 2 in 5 (41%) first-time buyers used gifted money for a down payment—up from 2023 (33%), and a big change from 2018 (14%). This ‘parental stimulus’ may or may not be needed, but certainly helps to artificially inflate entry-level prices.
Most of Canada’s First-Time Home Buyers Buy With Others On Title
Joint ownership amongst first-time home buyers exploded to 54% in 2025 from just 12% in 2024. Unlike the early 80s bubble (when this trend was extensively pitched but failed to catch on), today’s buyers increasingly share titles with parents, siblings, or investors—a desperate adaptation to unaffordability. It also tends to provide the same sort of stimulus as parental gifts, helping to artificially inflate prices.
Joint ownership is a trend that cyclically pops up at the end of the housing cycle. Right around the time everyone believes Canada is running out of land, which happens every 20-ish years.
The viability of starter homes has collapsed much faster than anyone could anticipate. It wasn’t exactly easy to buy a home in the late 2010s, but secondary capital such as non-mortgage credit, parental gifts, and joint ownership wasn’t as common back then. Canada now mirrors a Victorian era, inheritance-based culture—a reality suggested by its own national statistics agency.
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