This is how long you'll have to save to afford a down payment on a Toronto house
If you’re planning to buy a home in Toronto anytime soon, you could be saving for longer than expected.
According to a new study by The National Bank of Canada (NBC), the cost of down payments in Canadian cities skyrocketed in 2021.
The study examined housing and mortgage trends in 10 cities across the country and found that during the second quarter of 2021, housing affordability has worsened by the widest margin in 27 years.
Currently, to save up for a down payment for an average Canadian home, buyers would have to save at a rate of 10 per cent for six years — or 69 months.
But in Toronto, where the average home costs approximately $1.2M, the time period required to save for a down payment is much longer.
In order to save enough money for a down payment for a home in Toronto, a resident making a yearly salary of $196,913, saving at a rate of 10 per cent, would have to do so for 26.5 years — or 318 months.
To afford a condo in the city under these circumstances, it would take just under five years, or 56 months.
Meanwhile, median household income in the city only rose by a slight 0.9 per cent in 2021, according to NBC, “[failing] to offset the effect of these higher prices.”
According to StatCan's latest data, the 2019 median salary for individuals in Toronto aged 25-54 years was $60,300.
NBC’s study listed data for the Ontario cities of Ottawa/Gatineau and Hamilton, as well.
In Ottawa/Gatineau, it would take a little over four years to save up for a home down payment, if you’re saving at a rate of 10 per cent while making a salary of $124,891.
If you’re saving at the same rate in Hamilton, where the household salary needed to afford the representative home is $165,922, it would take six and a half years, or 78 months, to secure a down payment.
JULY HOUSING SALES IN TORONTO DOWN
The Toronto Regional Real Estate Board (TRREB) recently said that housing demand in the city dropped in July, compared to the previous year, but still remains above average for the season in 2021.
According to the board, nearly 9,400 home sales were reported in July, down 14.9 per cent compared to July 2020, which set a record for housing sales in the summer month.
Additionally, the board says the city’s housing market tightened in July, with the month's sales accounting for a greater share of listings compared to July 2020.
It says the average price for all home types combined was just over $1M, up 12.6 per cent compared to a year ago.
With files from The Canadian Press.
CTVNews.ca Top Stories
'One of the single most terrifying things ever': Ontario couple among passengers on sinking tour boat in Dominican Republic
A Toronto couple are speaking out about their 'extremely dangerous' experience on board a sinking tour boat in the Dominican Republic last week.
What Canadians think of the latest Liberal budget
A new poll suggests the Liberals have not won over voters with their latest budget, though there is broad support for their plan to build millions of homes.
opinion Why you should protect your investments by naming a trusted contact person
Appointing a trusted person to help with financial obligations can give you peace of mind. In his personal finance column for CTVNews.ca, Christopher Liew outlines the key benefits of naming a confidant to take over your financial responsibilities, if the need ever arises.
Teacher shortages see some Ontario high school students awarded perfect grades on midterm exams
Students at a high school in York Region have been awarded perfect marks on their midterm exams in three subjects – not because of their academic performances however, but because they had no teacher.
'My stomach dropped': Winnipeg man speaks out after being criminally harassed following single online date
A Winnipeg man said a single date gone wrong led to years of criminal harassment, false arrests, stress and depression.
Photographer alleges he was forced to watch Megan Thee Stallion have sex and was unfairly fired
A photographer who worked for Megan Thee Stallion said in a lawsuit filed Tuesday that he was forced to watch her have sex, was unfairly fired soon after and was abused as her employee.
Ottawa injects another $36M into vaccine injury compensation fund
The federal government has added $36.4 million to a program designed to support people who have been seriously injured or killed by vaccines since the end of 2020.
An Ontario senior thought he called Geek Squad for help with his printer. Instead, he got scammed out of $25,000
An Ontario senior’s attempt to get technical help online led him into a spoofing scam where he lost $25,000. Now, he’s sharing his story to warn others.
Her fiance has been in prison for 49 years. She's trying to free him before it's too late
Christine Roess is a retired consultant. Ezra Bozeman has spent the last 49 years in prison, serving a life sentence for a murder he says he didn’t commit. Against the odds, the two fell in love.