You make $75,000 per year. Will you ever be able to afford a Toronto house?
Owning a house in Toronto is a dream for thousands of people that continues to feel further and further out of reach.
With the average price of a Toronto home now above $1 million, many discouraged people sitting on the sidelines are wondering if the dream will ever become a reality.
This week, CTV News Toronto asked Chief Financial Commentator Patricia Lovett-Reid if it will ever be possible to own a home in Toronto if you're a single-income earner making around $75,000.
Lovett-Reid says the "harsh reality" is no.
"On $75,000 per year in Toronto, it isn't going to happen," Lovett-Reid said. "Unless you really are getting financial help from your parents."
She said that even if you’re able to come up with enough money for the down payment, people making around $75,000 per year will struggle with making ends meet on a day-to-day basis.
A new home is displayed for sale in a new housing development in Ottawa on Tuesday, July 14, 2020. (THE CANADIAN PRESS / Sean Kilpatrick)
Between making mortgage payments and service fees, Lovett-Reid said you simply "can't do the math."
She estimates that in order to comfortably pay all the fees associated with a $1 million house, you would need about $200,000 of income per year.
Lovett-Reid said that purchasing a "very small" condo might be an option, but with $75,000 per year it will still be a stretch.
So what should you do?
Lovett-Reid said it's all about compromise.
"You can’t have it all at the same time," she said.
For people who are set on buying a home, Lovett-Reid suggests continuing to save aggressively, while also looking to purchase in areas outside of the city.
"Be prepared to know what you will do and won’t do," she said. "Are you prepared to commute? If so, great. Look for a place on a commuter line."
And for those not willing to leave the city? Lovett-Reid said people should not be discouraged.
"There's nothing wrong with renting," she said. "There is nothing wrong with saying 'This imbalance in the market means I'm going to stay on the sidelines.'"
'I think it's an old paradigm where a rite of passage into adulthood means you own a home. It doesn't. It's just not the reality that today’s millennials are facing."
A CIBC report, released last month, found that Canadian parents are giving their children record amounts of money to purchase a home.
About 30 per cent of first-time home buyers received financial help from family this past year, the report found. CIBC said they were given an average of $82,000 to help with their down payment.
According to the Toronto Regional Real Estate Board, the average price of a detached home that sold in the city in September was $1.7 million.
The average for a semi-detached that sold was $1.3 million, while a townhouse was $930,000.
The average selling price of a condo in September was $744,730.
Do you have a financial question or topic you would like Pattie Lovett-Reid discuss? E-mail torontotips@bellmedia.ca.
CTVNews.ca Top Stories
Grandparent scam: London, Ont., senior beats fraudsters not once, but twice
It was a typical Tuesday for Mabel Beharrell, 84, until she got the call that would turn her world upside down. Her teenaged grandson was in trouble and needed her help.
Deaths of 4 people on Sask. farm confirmed as murder-suicide
The deaths of four people on a farm near the Saskatchewan village of Neudorf have been confirmed a murder-suicide.
CRA no longer requiring 'bare trust' reporting in 2023 tax return
The Canada Revenue Agency announced Thursday it will not require 'bare trust' reporting from Canadians that it introduced for the 2024 tax season, just four days before the April 2 deadline.
Full parole granted to man convicted in notorious 'McDonald's murders' in Cape Breton
The Parole Board of Canada has granted full parole to one of three men convicted in the brutal murders of three McDonald's restaurant workers in Cape Breton more than 30 years ago.
Incident on Calgary's Reconciliation Bridge comes to safe resolution
Nearly 20 hours after a man climbed and remained perched on top of the Reconciliation Bridge in downtown Calgary, the situation came to a peaceful resolution.
Sunshine list: These were the Ontario public sector's highest earners in 2023
Ontario released its annual sunshine list Thursday afternoon, noting that the largest year-over-year increases were in hospitals, municipalities, and post-secondary sectors.
George Washington family secrets revealed by DNA from unmarked 19th century graves
Genetic analysis has shed light on a long-standing mystery surrounding the fates of U.S. President George Washington's younger brother Samuel and his kin.
'We won't forget': How some Muslims view Poilievre's stance on Israel-Hamas war
A spokesman for a regional Muslim advocacy group says Conservative Leader Pierre Poilievre's stance on the Israel-Hamas war could complicate his party's relationship with Muslim Canadians.
Why some Christians are angry about Trump's 'God Bless the USA' Bible
Former U.S. President Donald Trump is officially selling a copy of the Bible themed to Lee Greenwood’s famous song, 'God Bless the USA.' But the concept of a Bible covered in the American flag has raised concern among religious circles.