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Drivers and homeowners

January 13, 2015

Read this if you're planning to buy a house

Workopolis is reporting that average Canadian home prices range from $819,336 in Vancouver to $264,447 in Halifax. Here’s how to find out what you can afford.

It’s well known that housing is becoming increasingly unaffordable in Canadian cities such as Toronto and Vancouver. But what does that mean in dollars and cents? How much do you have to earn to be able to buy an average house in a major Canadian city?

In a recent article, How much you need to earn to buy a house in every major Canadian city, Workopolis, the job-search website, did the math, using purchase price numbers from the Canadian Real Estate Association’s national average price map for each of Vancouver, Calgary, Edmonton, Regina, Saskatoon, Winnipeg, Ottawa, Toronto, Montreal and Halifax.

The purchase price isn’t the only measure of affordability a mortgage lender considers when deciding how much to lend you. Also factored in are the size of a down payment, mortgage interest rate, condo fees if applicable, cost of utilities and property taxes. Workopolis spoke to Toronto mortgage broker Adrian Williams, and used the purchase financing calculator and the property tax rates he provided, with the following assumptions: mortgage rate 2.99% (the current average qualifying rate for a five-year fixed-term mortgage); down payment 10%; monthly utilities bill $100.

Keep in mind that a higher interest rate would drive up the required income numbers, and a larger down payment would push them down. Williams noted that other monthly payments such as car loans and credit card debt will also affect your eligibility for a mortgage.

Not surprisingly, the income threshold varies widely across the country:

Vancouver

  • Average price: $819,336
  • Monthly mortgage payment: $3,570
  • Property tax: $251
  • Income required: $147,023

Toronto

  • Average price: $587,505
  • Monthly mortgage payment: $2,560
  • Property tax: $354
  • Income required: $113,009

Calgary

  • Average price: $465,047
  • Monthly mortgage payment: $2,026
  • Property tax: $236
  • Income required: $88,578

Ottawa

  • Average price: $357,887
  • Monthly mortgage payment: $1,559
  • Property tax: $336
  • Income required: $74,820

Saskatoon

  • Average price: $349,322
  • Monthly mortgage payment: $1,522
  • Property tax: $366
  • Income required: $74,546

Edmonton

  • Average price: $365,520
  • Monthly mortgage payment: $1,592
  • Property tax: $244
  • Income required: $72,617

Regina

  • Average price: $331,161
  • Monthly mortgage payment: $1,443
  • Property tax: $378
  • Income required: $72,028

Montreal

  • Average price: $344,273
  • Monthly mortgage payment: $1,500
  • Property tax: $237
  • Income required: $68,884

Winnipeg

  • Average price: $270,605
  • Monthly mortgage payment: $1,179
  • Property tax: $274
  • Income required: $58,235

Halifax

  • Average price: $264,447
  • Monthly mortgage payment: $1,152
  • Property tax: $266
  • Income required: $56,929

Acknowledging that income thresholds are only meaningful if you actually have an income, Workopolis helpfully includes links to job listings in each city.

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