Buying a home in Canada's unpredictable real estate market has been a daunting task for many buyers in recent years.
The Canadian Real Estate Association (CREA) reported the current national average home price in February 2023 at $662,437, despite the drop in home prices since the early peaks of last year. With interest rates rising and fluctuating housing affordability and mortgage rates in the last 10 months, many buyers have opted to wait and see how the situation unfolds before making any decisions.
Curious about the income currently required to purchase a home in Canada? Zoocasa, which provides Canada-wide real estate listings, insights, and sold data, recently conducted a study of average home prices in 20 different cities across the country and compared the median income of each city with the necessary income to afford a home at the current average price.
According to Zoocasa's findings, out of the 20 markets assessed, buyers with median household incomes could only afford to purchase a home in slightly over half of them. What's more, Ontario, on average, has the highest cost of homes, although there are some options for those earning around the median income. In Ottawa, for example, the average home price is $613,000, requiring an income of $94,763, which is lower than the city's median income of $121,790.
Similarly, in London-St. Thomas, the median income of $94,070 exceeds the necessary income of $90,225 to purchase a home at the average price of $583,500.
However, Toronto and Vancouver remain the most expensive markets with average home prices of $1,091,300 and $1,123,400, respectively. These two cities have median incomes of $96,700 and $98,640, and require an income of $168,712 and $173,663, respectively, to afford a home at the current average price.
Buying in Ontario
Toronto:
- Average home price: $1,091,300
- Income required for an average home: $168,712
- Median household income: $96,700
Niagara Region:
- Average home price: $627,500
- Income required for an average home: $97,013
- Median household income: $87,510
Hamilton-Burlington:
- Average home price: $831,300
- Income required for an average home: $128,512
- Median household income: $103,820
Windsor-Essex:
- Average home price: $565,400
- Income required for an average home: $87,413
- Median household income: $92,180
Kitchener-Waterloo:
- Average home price: $726,500
- Income required for an average home: $112,313
- Median household income: $101,690
Ottawa:
- Average home price: $613,000
- Income required for an average home: $94,763
- Median household income: $121,790
London St. Thomas:
- Average home price: $583,500
- Income required for an average home: $90,225
- Median household income: $94,070
Kawartha Lakes:
- Average home price: $653,600
- Income required for an average home: $101,063
- Median household income: $90,490
Barrie and District
- Average home price: $787,900
- Income required for an average home: $121,800
- Median household income: $99,560
Those looking for more affordable options should set their sights to the Prairies and the East Coast, according to Zoocasa, as they are the most affordable places to purchase a home.
In Regina, the median income is $106,340, significantly exceeding the required income of $47,963 to purchase a home at the average price of $310,200. Saskatoon also has greater affordability, where an income of $57,563 is required to buy a home at the average price of $372,400, with the median income around $102,830.
On the East Coast, in Saint John, an income of $41,513 is required to afford the average home price of $268,400, with the median income more than double that at $89,750. In Newfoundland and Labrador, the median income of $85,800 can comfortably purchase the average home price of $276,700, where only an income of $42,788 is required.
Take a look at the infographic below and see how the rest of the cities in the study ranked.
