Average Vancouver couple needs to earn $92,000 more to qualify for typical home

The average Vancouver couple needs to earn $92,000 more annually to afford a mortgage on a typical home in Vancouver — even after affordability in one of Canada’s most expensive cities improved slightly last month.

New figures from RateHub for January 2024 suggest the income required to buy a home in Vancouver finally decreased slightly. That’s a change from last year, when high interest rates and difficult stress tests meant homes became less affordable even though they cost less.

Between December 2023 and January 2024, the price of the average home in Vancouver dropped $7,400.

As interest rates held steady and stress tests softened, the income required to qualify for a mortgage on that average Vancouver home with a 20% downpayment also dropped $9,600.

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Vancouver is currently in the slow season when it comes to home sales, so prices could pick up again as the city heads into summertime — when more home sales are typically seen.

It’s a small ray of hope that homes are becoming more affordable in the city, but the city is still in the midst of a housing crisis with the average home decidedly out of reach for many people.

Talent.com pegs the average annual salary in Vancouver at just over $68,000 per year. If each member of a couple earns the average salary, their annual household income would be $136,000 per year.

That’s still $92,000 less annually than the household income required to qualify for a 5.71% mortgage and a stress test of 7.71%.

Ratehub estimates individuals or couples need to make nearly $228,000 annually to qualify for the average home. The average home cost $1.16 million in Vancouver last month.

Ratehub

Ratehub’s analysis found affordability improved in all major Canadian cities it studied between December and January. But looking forward, its analysts doubt 2024 will bring in a new era of affordability for Canadians.

Early-year data suggest the housing market is heating up, “piling pressure onto already-scant supply.”

The market is tilting back toward favouring sellers, with average home prices across the country up 7.6% year-over-year.