You can still afford a home on a single income in YEG, but prices are rising
While needing a six-digit income to afford a home remains the norm in much of Canada, Edmonton remains an outlier among major cities — though prices are on the rise.
A new report from Ratehub.ca calculated the minimum annual income required to buy an average home in some of Canada’s major cities based on January and February 2024 real estate data.
The report details how changing mortgage rates, stress test rates, and real estate prices are impacting the income required to buy a home.
In January, Edmontonians hoping to buy a home needed to make $82,730 per year to afford one. That increased slightly in February to needing $83,220 in take-home pay. Home prices also increased (up $5,200) to $375,300.
“The two key variables, which are home values and interest rates, have moved in opposite directions since January; interest rates are down and home values are up in 12 out of 13 cities. The increase in home values was enough such that affordability decreased in 11 of 13 cities despite the drop in rates,” said James Laird, co-CEO of Ratehub.ca and president of CanWise mortgage lender.
“Because the two key variables moved in opposite directions, the fluctuation in income required is lower than the swings we’ve seen in past months.”
Our neighbours to the south in Calgary saw an even bigger increase in house costs (up $10,400), with the average income required to purchase a home in that city also rising by $1,200.
Ratehub.ca
Cities including Edmonton, Vancouver, and Toronto saw average house prices increase in February. Affordability is poised to decrease even further this year, with the housing market showing signs of a “robust” spring season, Ratehub noted.
The Canadian Real Estate Association found that sales rose by 20% annually, and previously stagnant buyers are ready to jump back in due to the prospect of lower rates later this year.
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