Buying a home is a dream come true for everyone. But, the prospects of achieving the goal seem bleak for Canadian citizens, as costs keep piling up. Although there have been hints of stability in the housing market, rising mortgage rates and still-exorbitant home prices imply that a rise in income is still required to purchase a new home. According to a recent report by Oxford Economics, it might take several years before home prices plunge back to an affordable price range for the average Canadian.
Predictions suggest that the average Canadian family will have to wait till 2027 until housing becomes affordable and accessible. To add to that, the hike in interest rates by the Bank of Canada has further increased the mortgage rates, making housing all the more expensive and out-of-reach. In some regions of the county, average houses are priced at CAD 1 million, which is far beyond the means of a median-earning household. But, is all hope lost? Probably not! How? Let us find out!
Canada’s Most Affordable Homes
In Toronto, the price of an average house has touched the CAD 1 million threshold. Moreover, a recent study reveals that the gap between house prices and incomes for Ontarians has been massive and quite jarring. For instance, house prices have shot up by a whopping 180 percent, whereas the incomes of Canadians (especially Ontarians), has increased by a mere 38 percent. This means it will be difficult for youth with solid incomes to make down payments on a CAD 1 million mortgage.
But, all is not lost. A new research from Zoocasa illustrates real estate hubs that are quite affordable. The study looked at housing affordability in 17 of Canada’s largest areas and found some encouraging data. To begin, roughly seven of those markets are affordable for those making the area’s median salary. Just what are they? So, let’s go look around!
Saint John has been deemed a great city by Zoocasa due to its low house prices. Saint John had a median income of CAD 79,000, which is significantly less than the typical income in most other Canadian cities. However, the median home price in Saint John was only CAD 291,000. This is significantly less than the maximum home price requirement of CAD 361,565.
According to the Zoocasa study, another city that stands out in terms of home affordability is the Saskatchewan capital – Regina. The city has the largest gap between the average rate of a home and the affordable range for a median income earner.
Some of the other regions of Canada with a rather affordable home market are Winnipeg, Edmonton, Quebec City, the province of Prince Edward Island, and Saskatoon.
So, there we have it, a crisp overview on the house price affordability of Canada. The current scenario of house prices is quite disappointing, as mortgage rates rise and overall costs bolster. But, experts expect home affordability to improve considerably over the next decade into the mid-2030s. And of course, there are affordable home markets, like the ones mentioned above!
For more real estate-related news and tips, follow Realtor Catherine Nacar’s blog.