When you look at the way some South Asian immigrants dress, you could be forgiven for thinking they were close to being homeless, fallen on hard times or unemployed. But looks can be deceptive for many of these new immigrants live in million dollar homes and drive high end cars. They may have little or no disposable income because all of it goes toward their mortgages and other loans. In recent years, new Canadians have been driving Canada’s housing sales, treating houses like trophies and investments.
For decades, study after study revealed a troubling wage gap between Canadian-born whites and immigrants of color. In the workplace, there still exists a wage gap, but immigrants in general are bridging the wealth gap by investing in real estate and building housing wealth.
And this is particularly true when it comes to Chinese and South Asian immigrants who are more likely to invest in real estate and buy homes rather than rent like their Canadian-born counterparts.
The new research from Statistics Canada also found wealth growth for Canadian-born families has in recent years been driven both by increases in housing and registered pension plan assets, for immigrant families, housing alone has been the primary driver of wealth growth.
In 2016, immigrant families, in general, had “markedly higher debt-to-income ratios than their Canadian-born counterparts.”
Housing prices in Canada has stalled in the past year and it is expected to continue that way for the foreseeable future and while many new Canadians are over their heads in housing debt, it is unlikely that a majority of them would default and move into shelters.
There are several reasons why new Canadians would avoid that fate. A primary reason is that many of these families pool their resources and help each other out financially. So, if a South Asian homeowner were to suddenly find himself close to losing his or her home, chances are a family member or friend would bail them out.
Furthermore, many new Canadians tend to prefer or at least be open to the idea of renting out extra rooms or their basements to renters or other families. This allows them to service their mortgages. And joint-family living seems to be the norm in many parts of the GTA and Vancouver among many immigrant families.
There are many South Asian families in Brampton for example who buy monster homes where two or even three siblings live with their families. There are five or even six working members all pooling in their resources.
While millennials are now toying with the idea of buying houses along with friends and generally embracing communal living, South Asians have been doing so for years. In the west economic reality and necessity has encouraged the idea of joint families and sharing their living space with families and friends. This allows them to build and save wealth.
I know one South Asian couple in Mississauga that live in a large home where three of their bedrooms are rented out to single paying guests while another family lives in their basement. It is almost like a rooming house or a hostel, bang in the middle of a residential community.
It is clear that second-generation Canadians, even those South Asians who grew up in joint families would prefer living in smaller homes but on their own unlike first-generation immigrants who are quite accustomed to living with renters and extended families for extended periods of time.
It is only in recent years, young Canadians and Americans are starting to move back in with their parents because they can’t afford to buy or rent. But these young people are reluctant about living with parents long-term. They value privacy and space, two things that are often alien to new Canadians from other cultures and traditions. -CINEWS