Income needed to buy a home in Vancouver dips due to Canada's mortgage market
If you were hoping to buy a home in Vancouver, you would need to have more than a pretty penny in the bank and more coming in terms of income, but you don’t have to be as rich as before.
According to a new report from Ratehub.ca, there’s been a tiny dip in the income needed in April compared to March to buy a home in Vancouver.
You now only need to make $232,050 a year to buy an average home. Isn’t that good news?
Ratehub.ca calculated the minimum annual income required to buy an average home in some of the countryās major cities and found Vancouver’s affordability improved slightly, along with Montreal and Victoria, among all the Canadian cities.
According to the report, while the home prices jumped to a staggering $1.2 million in April, up $9,000 versus March, the income required to purchase has dropped by nearly $600.
That’s because the stress tests and the average mortgage rates have changed over the past two months.
The stress test rate was 7.62% in March and 7.50% in April.
Then, the mortgage rates “cooled” between 5.62% to 5.50%, according to Ratehub.ca.
āThe two key variables that impact home affordability, home values and interest rates, moved in opposite directions. Interest rates are down and home values are up in 12 out of 13 cities we looked at,” the report reads in part.
āThough home prices increased in Vancouver and Victoria, the decrease in mortgage rates was enough to still produce an improvement in affordability.ā
But, while Vancouver improved across the country, it’s still far from a turnaround.
āThe increase in home values was enough such that affordability worsened in 10 of 13 cities despite the rate drop,” the report said.
Many would argue that $230,000 is still far from a reasonable salary for many Vancouverites.
What do you think of this report? Let us know in the comments.
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