Top Affordable Canadian Markets for Single-Income Apartment Buyers

Buying a home on a single income can be a daunting task, especially with prices increasing and inventory dwindling. However, there are more affordable options available in the Canadian apartment market, and a new study from Zoocasa has determined which markets are the most and least affordable for single-income apartment buyers.

Zoocasa analyzed 15 cities across Canada, using March 2023 benchmark prices from the Canadian Real Estate Association (CREA). The real estate agency calculated the minimum down payment required for an apartment and compared the results with the median after-tax income for single-person households, which was sourced from Statistics Canada. They then calculated how many months it would take to save for a down payment in each city if a buyer saved 100% of their income.

The results showed that the five most affordable cities for single-income apartment buyers are located in the prairie provinces, while the five least affordable are found in British Columbia and Ontario.

Edmonton was deemed the most affordable city for single-income buyers, with a benchmark apartment price of $183,100 and a median after-tax income of $42,800. It would take just 2.6 months to save the $9,155 required for a minimum down payment in Alberta’s capital city.

Regina followed, with single-income buyers needing to save for 2.9 months to afford the $10,410 down payment required for a benchmark apartment, which costs $208,200. Saskatoon came in third place, with buyers needing to save for 3.4 months to afford a benchmark apartment that costs $225,500 and requires a down payment of $11,275.

In contrast, single-income buyers in Vancouver and Toronto need to save for more than a year to afford the down payment on a benchmark apartment. A minimum down payment of $48,740 is required in Vancouver, where a benchmark apartment costs $737,400, and buyers would have to save for 13.9 months with a median single-household income of $42K. Similarly, single-income buyers in Toronto who make $41,200 need to save for 13.2 months to afford the minimum down payment of $45,370 required for the benchmark apartment, which costs $703,700.

Victoria, Fraser Valley, and Hamilton round out the top five least affordable cities, with buyers needing to save for 9.2, 9.3, and 8.3 months, respectively, to afford a benchmark apartment.

Overall, it would take a single-income buyer 9.1 months of saving their entire after-tax salary to afford the minimum down payment on a benchmark apartment in Canada. However, it’s worth noting that these figures don’t account for additional costs such as closing fees, property taxes, and other expenses associated with homeownership.

In summary, if you’re a single-income buyer looking for an affordable apartment, your best bet is to focus your search on cities in the Prairie Provinces. But if you’re set on living in British Columbia or Ontario, be prepared to save for over a year to afford a down payment on a benchmark apartment. Regardless of where you choose to buy, it’s important to do your research and work with a qualified real estate agent to ensure that you’re making a smart investment.

Source: https://storeys.com/most-affordable-apartment-markets-single-income-buyers/