Purchasing a home in Canada while interest rates are on the rise can be tough, and doing so with one income can make it more challenging. But, there are cities in Canada that are more affordable for single-income households.
Determining The Most Affordable Cities For Single-Income Buyers
Zoocasa analyzed markets across Canada to determine which cities are best for single-income households. The average and benchmark home prices were sourced from the Canadian Real Estate Association (CREA) and regional real estate boards to determine which markets were the most affordable. To determine the minimum income required to qualify for a mortgage on the average home, we assumed the buyer would make a 20% down payment and receive a mortgage with the current average interest rate of 5.14% amortized over 30 years. Those findings were then compared to median income data of “persons living alone who earned employment income” as reported by Statistics Canada in their latest available census data from 2020.
The Most Affordable City
Regina is the most affordable major city in the country for those on a single income. A buyer earning the median income in the area of $58,000 would qualify for the purchase of an average-priced home, which is significantly below the national average of $322,800. The required income is around $5,000 higher than that required to buy a home. Townhouses and condo apartments are the most affordable options for buyers here. Buying a home on a single income in Canada right now looks to be very difficult unless you’re earning well above the median income. Townhouses and condo apartments are the most affordable option.
Other Cities That Are More Affordable For Single-Income Buyers
Other areas where you can buy on a single income are St John’s, Lethbridge, Saint John, and Edmonton. In Saint John, the median income of $48,000 would be just enough to afford the average home, currently priced at $289,500. This number is heavily influenced by the cost of a condo apartment, sitting at $221,500. Saint John and Regina are the only two cities where the average median income was greater than the actual income required to buy a home.
In St John’s, a buyer making the average income of $50,400 could purchase a townhouse or condo apartment, costing $276,700 and $215,000 respectively. The income required is slightly short of what is needed to buy the average home. The same can be said in Lethbridge, where the average income of $51,200 is just over $5,000 short of the average required income to purchase a detached home, but townhouses and apartments are still affordable in that price range. In Edmonton, the average income of $59,600 is a little shy of the income required for the average home detached home, but townhouses, costing $256,400, and apartments, costing $191,400, are great options.
Calgary, Winnipeg, and Saskatoon are the last three major areas on the list. In Calgary, the average price of a condo apartment is $289,600 in Calgary, making it a viable option for single-income buyers earning the median income. The same goes for Winnipeg and Saskatoon, where condo apartments are $231,200 and $219,800 respectively.
Regardless of where you choose to buy, it’s important to work with a real estate agent that can help you understand your options and the most affordable markets for your financial needs. If you’re ready to begin your home search, download the free Buyer’s Guide to get you started.