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
'Anything to win': Trudeau says as Poilievre defends meeting protesters
Prime Minister Justin Trudeau is accusing Conservative Leader Pierre Poilievre of welcoming 'the support of conspiracy theorists and extremists,' after the Conservative leader was photographed meeting with protesters, which his office has defended.
What is changing about Canada's capital gains tax and how does it impact me?
The federal government's proposed change to capital gains taxation is expected to increase taxes on investments and mainly affect wealthy Canadians and businesses. Here's what you need to know about the move.
'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.
Bank of Canada officials split on when to start cutting interest rates
Members of the Bank of Canada's governing council were split on how long the central bank should wait before it starts cutting interest rates when they met earlier this month.
Pilot reported fire onboard plane carrying fuel, attempted to return to Fairbanks just before crash
One of the two pilots aboard an airplane carrying fuel reported there was a fire on the airplane shortly before it crashed and burned outside Fairbanks, killing both people on board, a federal aviation official said Wednesday.
'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.
Quebec nurse had to clean up after husband's death in Montreal hospital
On a night she should have been mourning, a nurse from Quebec's Laurentians region says she was forced to clean up her husband after he died at a hospital in Montreal.
7 surveillance videos linked to extortions of South Asian home builders in Edmonton released
The Edmonton Police Service has released a number of surveillance videos related to a series of extortion cases in the city now dubbed 'Project Gaslight.'
Ukraine uses long-range missiles secretly provided by U.S. to hit Russian-held areas, officials say
Ukraine for the first time has begun using long-range ballistic missiles provided secretly by the United States, bombing a Russian military airfield in Crimea last week and Russian forces in another occupied area overnight, American officials said Wednesday.