The convergence of boomers reaching retirement age at the end of an era of historically low interest rates has conjured fear about the impact on the housing market of a growing number of homeowners choosing to downsize to condominiums.
But not all baby boomers will be willing to forgo the lifestyle of a single-family dwelling, said Miranda McKenna, a realtor with Real Estate Homeward brokerage in Toronto.
"That generation of baby boomers really likes to have the house, the garage, the garden; it keeps them active," McKenna said.
"For retired people, going into a condo is a nice idea because they don't have to do anything, but it's also restrictive. It's the transition from a bigger house with a yard to a smaller space that gets them."
Indeed, the latest numbers from the National Household Survey, released Wednesday, suggest condominiums are becoming the domain of both young and old. Among owners, 20 per cent are under the age of 35, compared with 10.5 per cent for other dwellings, the Statistics Canada survey indicates.
As predicted, they are proving popular with the retirement set. 26.1 per cent of Canadian owners are aged 65 or older, compared with 20.7 per cent for other dwellings.
Jane Drover, a Calgary professor who is a year and a half away from retirement, said she expects to end up in a condo, but not for at least a few more years.
"I travel so much that I would like a place where I don't have to look after yard work or worry about a leaky roof or a pipe bursting," she said. "That's a shared expense when you have a condo."
But many of her friends who plan to downsize are looking to move into smaller homes, not apartments, because condo fees can be so high they can feel like a mortgage, Drover added.
Phil Soper, president and chief executive of real-estate firm Royal LePage, said many new retirees suddenly find themselves dealing with kids at home.
"The adult children of boomers are living at home at about twice the rate as baby boomers themselves when they were that age," Soper said. "They need the space to house not only themselves, but also these boomerang young adults who are living at home and working."
Baby boomers are the wealthiest generation of retirees to date, with almost 80 per cent owning their homes outright, Soper added. "They don't need the money for retirement right now."
Financial tools like reverse mortgages, which allow people to stay in their house while still making withdrawals on the capital, also allow older homeowners to stay in their homes longer.
Immigration is also keeping the condo market buoyant.
Across Canada, the new home market, which includes condos and single homes, is being overbuilt by about 250,000 units or about a whole year worth of building, according to TD economist Diana Petramala.
"Immigration is strong, (so) we do think that these units can over time be easily absorbed by increasing demand," she said.
"Maybe the pattern of immigration is changing ... but they are spreading out to areas where there has been more overbuilding, like Calgary, Edmonton, maybe some of the Atlantic provinces, where resource sector is driving good employment outcomes."
Experts also believe markets across Canada have stabilized after any bumps in home sales following Ottawa's tightening of lending rules.
Wednesday's survey numbers also made it clear that many Canadians are swimming in housing debt. About 3.3 million households, some 25 per cent, spent 30 per cent or more of their total income on shelter — mortgage or rent payments, plus utility bills, property taxes and condo fees — exceeding the Canada Mortgage and Housing Corporation's measure of affordability.
Those that exceeded the threshold did so to the tune of an average of $1,259 a month, about $510 more than what CMHC's measure suggests they can afford.
And while the potentially toxic combination of high household debt and a possible interest rate hike could send the finances of Canadians spiralling out of control, economists believe it's only a real threat if rates climb suddenly and sharply.
"It's true that as home prices have risen people have taken larger debts than maybe they've been used to, but interest rates are low and debt is actually quite affordable for the majority of households," said Petramala.
"Our anticipation is that interest rates are only going to be able to go up gradually."
Soper said he doesn't believe any changes will happen until well into 2014, and when they do, the market will simply take a breath and adjust, especially if the underlying economic fundamentals stay strong.
"If people remain confident in their ability to make monthly payments, they will just adjust," he said. "They will adjust their expectations in terms of buying a less expensive home or potentially a different neighbourhood."
That's exactly what Liz Clark, 34, chose to do when she and her husband bought their first home four years ago.
While many of her friends opted for big, newly built homes, the Hamilton mother of two chose a modest starter home in a neighbourhood she liked.
"Even though I'm approved for a certain amount of mortgage, I never go above what I can afford comfortably."