real estate relocate

You need to make more than $160K to afford the average home in Toronto

A new report on the income needed to afford a home in different cities across Canada was just released, and to no one’s surprise, it’s not looking so good for Toronto. The report by Zoocasa found that the income required to purchase the average home in Toronto is $168,712 — but the median household income in Toronto is only $96,700.

With a discrepancy of $72,012 between household income and and the average home price in the city, Toronto comes in a close second behind Vancouver for the biggest discrepancy. To calculate the income required to purchase a home, Zoocasa assumed a 20 per cent downpayment, a 4.74 per cent mortgage rate and 30-year amortization. The median income was based off of the 2021 census from Statistics Canada.

Toronto was one of only eight cities included in the report with a median household income that is below the income required for an average home. Six of those eight cities are located in Ontario — Niagara Region, Hamilton-Burlington, Kitchener-Waterloo, Kawartha Lakes and Barrie and District.

Though home prices have been dropping across Ontario and in Toronto, affordability has not exactly gotten any better — rising interest rates made it difficult for most prospective buyers to enter the market. Now, it looks like prices are starting to turn around again in Toronto, rising for the first time in almost a year. None of this is helpful for Toronto residents, who are already $70,000 behind the income they’d need to purchase real estate in the city.

But it’s not all bad news. If you’re willing to move, there are a few cities in Ontario with median household incomes that come in above the income required to afford a home in the area. The median income in Windsor-Essex is $92,180, which is slightly more than you’d need to buy the average home at $565,400. Ottawa’s median household income is more than $20,000 over what you’d need to afford a $613,000 home in Canada’s capital city. And the $94,070 median income in London St. Thomas will be more than enough to buy an average home at $583,500.

And if you’re willing to move even further, Calgary, Edmonton, Montreal, Halifax, Saskatoon, Regina and Saint John all have median incomes that are above what is required to afford the average home in each city. The message of the report is clear — if you want to buy a home, get out of Ontario and B.C.