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
NEW From yearning for a change to cost of living, why some Canadians have left or may leave the country
For some immigrants, their dreams of permanently settling in Canada have taken an unexpected twist.
NEW Capital gains tax change 'shortsighted' and 'sows division' business groups tell Freeland
Forging ahead with increasing Canada's capital gains inclusion rate 'sows division,' and is a 'shortsighted' way to improve the deficit, business groups are warning Finance Minister Chrystia Freeland.
Here are the ultraprocessed foods you most need to avoid, according to a 30-year study
Studies have shown that ultraprocessed foods can have a detrimental impact on health. But 30 years of research show they don’t all have the same impact.
Police handcuff man trying to enter Drake's Toronto mansion
Toronto police say a man was taken into custody outside Drake's Bridle Path mansion Wednesday afternoon after he tried to gain access to the residence.
What is whooping cough and should Canadians be concerned as Europe declares outbreak?
There is currently a whooping cough epidemic in Europe, with 10 times as many cases compared to the previous two years. While an outbreak has not been declared nationwide in Canada, whooping cough is regularly detected in the country.
Ontario man frustrated after $3,500 paving job leaves driveway in shambles
An Ontario man considering having his driveway paved received a quote from a company for $7,000, but then, another paver in the neighbourhood knocked on his door and offered half that rate.
Florida deputies who fatally shot U.S. airman burst into wrong apartment, attorney says
Deputies responding to a disturbance call at a Florida apartment complex burst into the wrong unit and fatally shot a Black U.S. Air Force airman who was home alone when they saw he was armed with a gun, an attorney for the man's family said Wednesday.
Air Canada ranks near bottom on customer satisfaction: survey
Air Canada ranks below most other major North American airlines on customer satisfaction, with airfares a particular sore point, according to a new survey.
U.S. presidential candidate RFK Jr. had a brain worm, has recovered, campaign says
Independent U.S. presidential candidate Robert F. Kennedy Jr. had a parasite in his brain more than a decade ago, but has fully recovered, his campaign said, after the New York Times reported about the ailment.