OTTAWA — Older baby boomers are showing no signs of sliding passively into retirement, some even taking on new mortgages to upgrade housing rather than downsizing, as has been the norm for their age group, a report by real-estate firm RE/MAX said yesterday.

The report said a significant number of boomers, the leading edge of whom are aged 58, have been upgrading to more expensive properties and in some cases assuming mortgages, unlike previous generations who typically downsized their homes and cashed in their equity as retirement approached.

For example, 61.6 per cent of Canadian homeowners aged 45 to 54 years held a mortgage in 2001, up from 59 per cent two years earlier, and 39.1 per cent of those aged 55 to 64, up from 35 per cent, it said.

“As the first wave of baby boomers head into their retirement years, realtors and builders alike are scratching their heads,” said Elton Ash, a RE/MAX vice-president. “Most of us work all our lives to be mortgage-free . . . the thought of incurring debt at this stage of the game has given many of us reason to pause.”

The report credits low interest rates and healthy real-estate markets, combined with increased financial security, for much of the shift in the attitudes of those currently nearing retirement age.

“Money is so cheap these days, the principal residence has become part of the overall investment strategy and ultimately, the retirement plan,” Ash said.

However, there are a number of other factors that set boomers apart from their predecessors, the study says. Canadians today are living longer and are more active than previous generations. Many have also accumulated significant wealth.

Those with the wealth are looking for luxury condominiums, communities offering golf and adult lifestyles, secondary residences and smaller homes in better areas.

Older boomers are moving into major centres to be close to family, friends, cultural activities and health-care services, it says, adding they are also fuelling the housing renovation and restoration market with their demands for housing with all the bells and whistles.

They are looking for housing that offers low maintenance, security and location. “Condominium sales, as a result, are on the upswing from coast-to-coast,” the study says, noting condo sales represent anywhere from 31 per cent of total sales in Vancouver and 30 per cent in Toronto and Edmonton, to five per cent in Cornwall.

In contrast, it says normal retirement locations outside Canada, such as Florida, Arizona, and California have lost some of their appeal due to the high cost of health insurance and what was, until recently at least, the depressed value of the loonie.

The report says relatively warmer communities, such as Victoria, Kelowna, Niagara and Halifax are luring boomers.

© The Vancouver Province 2004