Price gains hurt affordability in most markets across Canada

Reviews and recommendations are unbiased and products are independently selected. Postmedia may earn an affiliate commission from purchases made through links on this page. Higher home prices in January led to decreased affordability in most major Canadian markets, a new study has found.

Ratehub.ca published a study in late February that looked at month-over-month changes in average prices in 13 major markets, and then determined the income required to qualify for a mortgage with a 20 per cent down payment. All cities, but Fredericton, N.



B., saw their average price rise month over month in January. As well, the Maritime city was the only market to see the income requirement fall.

There, a buyer required about $80,850 in January, $450 less than in December, to qualify for a home priced at $338,000. As well, the monthly mortgage payment declined $12 to $1,775. That’s based on a five-year, fixed-rate mortgage at 4.

70 per cent. Ratehub.ca, however, calculated the income requirement based on the federal stress test where borrowers must qualify at two percentage points higher, or 6.

70 per cent. Interested in more newsletters? Browse here. Calgary saw the smallest jump in average price.

(Fredericton’s average price fell $2,300 month over month.) The average price grew $700 in January to $573,100 in Calgary. In turn, buyers required an annual income of $126,470, an increase of $120.

The monthly payment also inched $4 higher to $3,003. Edmonton saw among the highest average price growth, up $14,800 to $412,200. Required income also grew $2,890 to $95,150.

The price jump also meant the mortgage payment increased $78 to $2,160 per month. Hamilton saw the largest increase in price up $20,900 to $819,500. Borrowers required an income of $174,405, up $4,050 from December.

The monthly mortgage payment grew $110 to $4,294..