Tag Archives: single buyers

The future of homeownership is female

The future of homeownership is female 

Girl power is growing in the real estate world.

61% of first-time and repeat homebuyers in Canada were female, according to the 2019 Canadian Mortgage and Housing Corporation (CMHC) Mortgage Consumer survey. This is backed up by statistics coming out of the US as well. Single women made up 17% of homebuyers in 2019, according to the National Association of Realtors, while single men accounted for about 9%.

“I’ve definitely seen a shift, with more women showing interest in buying a home. The whole concept of waiting till you’re married to own a home is not as strong as it used to be,” said Rakhee Dhingra, CEO of Mortgage Savvy.

After having a negative experience buying her first home, Dhingra decided to get into the mortgage business herself and created Mortgage Savvy in 2016. Since then, she has been committed to changing the transactional nature of the mortgage process. She is specifically interested in helping the growing number of women homebuyers become more confident in applying for mortgages through different initiatives like hosting homebuyer events and seminars.

“More single women are buying homes and even women in relationships are applying for mortgages as the more-significant income earners. Women are showing up as very strong from a financial standpoint,” she said. On top of that, Dhingra has also noticed in the case of couples going through a divorce, there’s a rising number of women who are buying out their male counterparts so they can stay and own their primary residence.

Not only is she focused on helping women into their dream homes, Dhingra also wants to encourage other female professionals to consider mortgage as a career option. Even though it’s a historically male-dominated industry, she believes her emphasis on building real relationships and the ability to connect with her clients has really been the key to her success. She believes the industry needs more of that.

“I always make an effort to be available if a new professional reaches out for coaching or support. Several women who were part of my team have grown their career and eventually moved on to build their own business, and I really support that,” she said. Dhingra said while she hopes to be a mentor for many young women in the mortgage business, she didn’t really have that opportunity when she was starting out not too long ago.

Dhingra is known by her team and referral sources for calming demeanor and her ability to ease people’s anxiety during the intimidating process of either buying a home for the first time, doing a refinance, consolidating debt or going through a divorce.

“If I can provide concrete information in a digestible manner for clients, and keep them calm through the process, that’s the key. We keep communication timely and detailed, which helps eliminate a lot of the stress,” she added.

In 2019, Dhingra was chosen by CMP as a Women of Influence. The recognition has been incredible positive for her and her business, but what she is most proud of is being able to show her daughter her success.

Dhingra also puts her money where her mouth is. Fifty dollars from ever transaction at Mortgage Savvy goes toward supporting local causes in Toronto, including the Red Door Family Shelter which assists families, refugees and women who are fleeing violence.

In the future, Dhingra hopes to help promote a stronger balance in the mortgage industry by bringing more women in.

“There needs to be more opportunity for collaboration and networking for not just women, but the industry as a whole. There needs to be a safe place for people to share information and knowledge without being seen as competition or a threat.”

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Investors eye rent-to-own strategies as Canadians look for more ways to home ownership

Rent-to-own is becoming an increasingly attractive option for investors. While the practice isn’t as popular with our neighbours south of the border, here in Canada it is a great option to consider especially with tightening regulations, a complex market and new mortgage rules.

With more than 11 billion people across the country renting, and housing prices becoming more unattainable, tenants are looking for more options and investor interest is brewing on what opportunities are out there.

A rent-to-own strategy is an alternative route to home ownership for buyers who aren’t quite able to purchase their new home but are interested in eventually attaining ownership. It could be a great option for someone who is self-employed, new to Canada or has a damaged credit. The tenant would pay a monthly fee similar to rent, but a portion of that goes toward a down payment for that home. In addition, at the end of the agreed -upon term, the tenant would be in a position to qualify for a mortgage through traditional lending institutions and the property title will transfer to their name.

“There are many people across the country who are so close to getting their own home but need someone on their team like Homeowners Now and our partners that can support them through those last few steps,” said Conrad Field, VP Partnership at rent-to-own company, Homeowners Now.

From an investor’s perspective, rent-to-own is a low risk option that can maximize cash flow, target areas with high appreciation and allow for turnkey operations to occur. “Rent-to-own models have the ability to both grow wealth in strong markets, as well as protect it in a correction,” said Field.

According to him, rent-to-own is like a cross between shorter-term development projects and longer-term buy-and-hold properties. You get the benefit of receiving your capital back with profit in a relatively short time period like a development project, but also the security of monthly rent revenue like with a buy-and-hold. “There are benefits for everyone in the eco-system, from our partners, tenants and the rent-to-own company. As a wealth-building vehicle for our partners, some of those benefits include the security of substantial deposits, additional revenue streams under contract, minimal ongoing management, reduced expenses and more,” he added.

Homeowners Now has partnered with some of the most experienced professionals in the real estate industry to put systems and processes in place to maximize the success of tenants and provide security for their partners. The tenant-first approach is a key aspect of that, according to Field. “We find the tenant, qualify them for our program based on a set of financial criteria and then they pick their dream home on the market that is within the price range they can afford. What’s great about this is the tenant truly gets the house of their choice instead of having to select from a potentially very small list of available properties,” said Field. This means the tenant is more motivated to follow through with the program and likely to have years of happiness in their home. Homeowners Now uses a deferred purchase agreement, rather than a lease option, which is able to provide additional security for investors.

In a new whitepaper, Field shares more detailed information on how to maximize return on investments this year through a rent-to-own strategy. “A lot of people don’t have the time to put these pieces in place and are looking for a hands-off way to get involved. They want their money working for them so they can focus on other priorities,” said Field.

Source: Canadian Real Estate Magazine – by Kasi Johnston 30 Jan 2020

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How I Built a $1.3M Real Estate Portfolio for the Cost of a 1-Bedroom in NYC

  

Hand of Business people calculating interest, taxes and profits to invest in real estate and home buying

Is this crazy? I sat there with my 23-year-old head spinning—looking at the first $400,000 multifamily rehab project that I had just put under contract.

You’ve probably asked yourself (at least) a couple times if it’s crazy to get into real estate, too. If you asked your friends and family instead, they probably immediately answered, “Yes!”—followed by a spiel about whatever aspect of managing a real estate business that scares them most.

Maybe they mentioned the risk of a market crash, the challenge of dealing with tenants, or the pitfalls of negotiating with contractors. It’s only human. We fear risk.

We fear risk even when our fears are irrational.

Even if you drink the real estate Kool-Aid and know that real estate can be an amazing way to build wealth, the fear probably hits you each time you’re about to write an offer on a building. Do I really know what I’m getting myself into?

Right Before the Plunge

On that night in May 2017, I was on the verge of taking what—to many people—would look like the biggest risk of my young life. I was 23, had recently graduated from college, and had barely six months of real estate experience. This project would pit me and my business partner against countless situations we were not prepared for, faced with countless questions we didn’t know the answers to.

Luckily, as real estate investors, it’s not our job to know the answers. It’s our job to know the numbers.

The numbers on our first rehab deal told us that even in our worst-case scenario—even if everything that people warned us about went wrong—taking the plunge would get us closer to financial freedom than sitting “safely” on the sidelines ever could.

Why are we comfortable losing money, as long as we know how much we’re going to lose?

As a recent grad, most of my college friends ended up in big cities on the coasts.

Related: Mastering Turnkey Real Estate: How to Build a Passive Portfolio

In 2017, the median rent in Manhattan was $3,150 a month. According to Rent Jungle, the average rent for a one-bedroom apartment in San Francisco was even higher: $3,334 a month. Over the course of a year, that adds up to $40,000 in rent for a one-bedroom apartment.

For reference, the median family income in the city of St. Louis is $52,000 a year. In St. Louis, that money can buy buildings.

On the coasts, it buys you the right to spend up to 39 percent more than the national average on basic necessities like groceries. The costs are pretty crazy, but the craziest part is that spending a family’s annual salary on rent is somehow considered a perfectly normal financial decision for a young person to make.

Young people spend that money with no expectation of getting a return. Rent, groceries, and transportation are costs—not investments.

What is the risk of embarking on a rehab project compared to the 100 percent certainty of spending $40,000 a year on rent?

How We Measure Risk

Risk is exposure to uncertainty. Because of this, renting doesn’t feel like a risk. Neither does spending a lot to live in a big coastal city. The costs are large, but they’re constant. We know them up front: $40,000, paid in tidy, predictable monthly increments.

Or do we?

What is the real risk of renting away your twenties—and how do you compare it to the risk of a rehab project? Does renting in a big city make your financial future—not in 10 months, but in 10 years—more certain or less so?

When you’re embarking on a rehab project, uncertainty stares you in the face. The risks are all right ahead of you, a landmine of knowns unknowns:

  • Do we have our contractors lined up in the right order?
  • Have we done everything we need to pass inspection?
  • Will we hit our rent targets once all the work is done?
  • Is it cheaper to fix this or replace it?

Those seem like hard questions to answer. Small wonder that most people warn you away from real estate.

Except when you’re following a safe, “normal” path, uncertainty isn’t gone. It’s just waiting for you out of sight.

Five years from now, will I be working at a job I don’t like? Or will I be free and doing the things that matter to me most in life?

Ten years from now, will I have the resources to protect what I love? To support my family, friends, and community?

Those are hard questions to answer.

For me, those questions would have been impossible to answer if I lived in a big city on the coast, took a fancy job where I was well paid but spent most of my salary on rent and groceries, and had to spend most of my time working for someone else.

We are conditioned to deal with long-term uncertainty the same way we’re taught to deal with short-term risk: by avoiding it.

But avoiding risks doesn’t make them go away. It doesn’t teach us anything. It doesn’t get us any closer to answering life’s hardest questions.

The numbers on our first rehab deal told me two things. In the worst-case scenario, I would come out of the deal not losing any more money than someone who chose to rent in a big city. In the worst-case scenario, I would come out of the deal with an education that would allow me to take control of my financial future.

I could live with that.

The Numbers Tell the Story

My business partner, Ben Mizes, and I started our real estate portfolio with an FHA loan. We were only required to put a small down payment on a relatively stress-free, low-maintenance fourplex.

Five months later, we were planning to borrow $315,000 from the bank and $105,000 from private family investors and spend as much of our own time, sweat, and money as it took to come out the other side of our first four-unit rehab.

The project would be our first BRRRR (or buy, rehab, rent, refinance, repeat).

We were upgrading kitchens, bathrooms, and AC units to bring the rents up from $825 per door to $1,400 per door—a 70 percent increase.

With renovations complete, Ben and I would try to appraise the building for $700,000. Depending on the lender, you can borrow between 70 to 85 percent of a building’s appraised value. In this range, as long as we hit our numbers, we could completely repay our investors, recoup our costs, and walk away owning a cash-flowing castle.

The potential upside was clear. Just as important, we looked at our downside.

Ben and I modeled a worst-case, “do-nothing” scenario, trying to understand what would happen to us if we got stuck and couldn’t complete the rehab at all.

What Could Go Wrong? 

Well, plenty.

Ben and I had a contract to buy the building for $420,000. At the closing table, the seller would credit us for the $20,000 worth of repairs that had to be done immediately: fixing a collapsed sewer, repainting and sealing damaged windows, and replacing falling fascia boards.

Note: We always, always, ALWAYS make our buildings watertight before doing anything else. If they aren’t watertight when we buy them, we negotiate for repair credits to fix problems on the seller’s dime—immediately upon closing.

The $20,000 repair credit provided by the seller brought our effective purchase price to $400,000. Combined, our mortgage payments, taxes, and insurance came out to $2,277 per month.

The numbers told us we could make our mortgage payments comfortably, even in its current (read: very rough) condition. The building was generating income of $3,350 per month, or about $825 per door.

Assuming we got completely stuck and had to keep renting the units out for their present value of $825, we would have $1,073 per month with which to pay all of our fixed and variable expenses. Utilities and HOA fees (the building is in a private subdivision with an annual assessment) came out to $380 per month, leaving $693 a month to deal with variable expenses.

In a worst-case scenario, we would be self-managing to save on property management fees. That would still leave us with vacancy, repairs, and maintenance costs, and the need to set aside money each month for a capital expense escrow.

Was $693 really enough?

Under our most-conservative model, we planned to put aside $10,000 each year for repairs and escrow. After five years, that equals $50,000 put into proactive maintenance—enough to deal with a roof, a complete tuck-pointing redo, and major structural repairs.

Then, we figured 10 percent vacancy cost—high for the area but not impossible if we had hard luck. What was the worst that could happen?

deal analysis

Under our worst-case model, we would be losing $600 every month. Losing $600 a month is a losing deal. That’s not a deal that gets you on a podcast. It’s not a deal that successful investors show off in a blog post.

Luckily, it’s not the deal we ended up with, either. (Spoiler alert: We came out of this rehab with a lot more paint on our shoes but a lot more cash in the bank, too.)

But when we talk about “risk,” here’s the curveball question: Would this “worst-case” deal be a step away from, or a step toward, financial freedom? Let’s look at those numbers again.

The Difference Between Costs and Investments

An investment is any place where you can put your money, such that it creates more wealth over time. In the model above, a lot of the expenses that look like “costs”—that is, look like places where Ben and I would have lost money—are actually investments, places where our money helps us build wealth.

Related: Why Turnkey Rentals Might Just Be an Ideal Investment for Real Estate Newbies

1. Loan Pay-Down

In our worst-case scenario, we would pay $600 a month (on average) to cover the costs of repairs and build a sizable rainy day fund.

However, our $1,600-per-month mortgage would be completely paid for by our tenants. In the first year alone, our tenants would pay for our ~$14,000 interest payments and help us build $5,000 worth of equity in the building.

Over time, that equity build-up only accelerates. In our thirties, Ben and I will build up $85,000 through principal paydown alone (pun intended).

The amazing part is that would be the case even if the rehab project was a complete failure. Breaking even on mortgage and utilities and scraping out of pocket to cover unexpected repairs, Ben and I would still be positioning ourselves to accumulate passive wealth in the future.

2. Proactive Maintenance

If you spend $50,000 on a building in five years, it becomes a lot cheaper to maintain. Under our worst-case model, we would have $10,000 a year to deal with maintenance issues before they became more serious.

When you budget to deal with problems up front, it makes for a less-impressive pro forma—but it also means that maintenance costs get significantly lower over time.

If you plow $10,000 every year into it, even a problem-ridden property will get easier and easier to take care of. It might be a painful cost to swallow in the short-term, but you haven’t lost the money that you spend on a property you own. You’ve just re-invested it.

By contrast, if you spend $40,000 in one year on rent, the money is out of your hands for good.

3. Hands-On Education

When you buy your first rehab, the most important investment you make isn’t in the building. It’s in yourself. You’re taking out (quite possibly) the only student loan in the world that can pay itself off in less than a year.

The most daunting part of diving into a real estate deal—the part that makes people say it’s too risky—is that you don’t just stand to lose money but time, too.

The time costs on this project would have made this a losing deal for a veteran investor. We spent untold hours painting, fixing plumbing, and (like you saw above) drilling holes through concrete when a contractor dropped the ball on us.

But we weren’t veteran investors (yet!). As Ben and I looked at the numbers together, we realized we were buying ourselves both a building and an education, too. Even if we broke even, we would come out of the project with an education that in itself was worth hundreds of thousands of dollars.

So—What Happened?

A few years ago, I sat looking at the numbers on a $400,000 real estate deal that could either set me on the fast-track for financial freedom or go completely off the rails. In the end, both things happened.

My business partner and I got screwed over by not one but four different contractors before we finished the project. One caused thousands of dollars of water damage to the floors, embroiled us in a months-long insurance claim, and tried to take us to court after he lost.

We dealt with an irascible tenant who threatened us and damaged his apartment.

Time and again, things took more time, sweat, and money than we had expected. But the age-old mantra of real estate investing held true: You make money when you buy. The numbers of the deal were strong.

And now that we’re done dealing with contractors, tenants, and renovations (at this property), we have a building that rents for $1,400 a door, water-tight with low maintenance costs, and a fair market valuation between $650,000 and $700,000.

Now we are on pace to refinance the building, fully repay our investors in the first year, and walk away with the funds to do it all over again.

Taking the Plunge (Again)

Is this crazy? Fast forward and I’m sitting here, head spinning, looking at the numbers of a 20-unit deal in St. Louis.

Since starting our renovation project one year ago, we’ve used the education and cash flow we gained from it to build a 22-unit portfolio—and a high-growth startup.

Now, with a refinance underway, I am looking at a deal that could double the size of our portfolio overnight, all while working full-time.

A new project brings new unknowns. More questions we don’t know how to answer and lots more numbers to keep me and Ben busy.

Source: BiggerPockets.com – Luke Babich

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Mortgage qualification a barrier to homeownership — poll

A growing number of Canadians see mortgage qualification as the biggest barrier to homeownership, according to a recent study by Zillow and Ipsos.

Around 56% of Canadians see qualifying for a mortgage as a barrier to homeownership, a six-point increase from 2018. After mortgage qualification, the next top worry for buyers is whether they can afford the mortgage payment, with roughly 54% saying so.

Canadian borrowers have to qualify under the stricter mortgage requirements and stress test that took effect in January 2018. Under the new rules, borrowers should be able to prove that they can service a mortgage at a higher rate.

“The rule only applies to newly originated mortgages and is designed to prevent borrowers from taking on more debt than they can handle if interest rates go up,” the study said.

One in two Canadians said they are concerned that these new rules will prevent them from qualifying from a mortgage.

Younger borrowers bear the weight of the new rules the most, with 69% of those in the 18-34 age bracket feeling concerned about qualifying for a mortgage.

“These mortgage regulations could impact a substantial portion of potential buyers, as the survey results show a large share of Canadian homeowners get mortgages. This worry is also present for current renters who may be considering the purchase of their first home,” the study said.

A recent report by the Canadian Mortgage and Housing Corporation, however, indicated that most buyers felt there were benefits to the stress test. The CMHC survey found that 65% of buyers believe the mortgage qualification stress test will prevent more Canadians from taking on a mortgage they can’t afford in the future.

While the majority of homebuyers surveyed by CMHC were aware of the new rules, more than three-quarters said the changes had little or no impact on their decision to buy a home. This number is down slightly from 80% in 2018, but still represents a healthy majority of homebuyers.

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Canadian buyers increasingly worried about qualifying for mortgage

Canadian buyers increasingly worried about qualifying for mortgage 

Ninety-two percent of Canadians see at least one barrier to home ownership, and two of the top concerns are related to the mortgage process, according to a recent survey from Zillow and Ipsos.

Canadians report feeling pressured by stricter mortgage regulations that went into effect in 2018 and Zillow’s survey found that 56% of Canadians see qualifying for a mortgage as a barrier to home ownership—a six-point increase from 2018. This concern rises to 64% for consumers who recently purchased a home, likely linked to the impending mortgage regulation changes at the time of their home search.

New and stricter mortgage requirements took effect in January 2018 with the addition of a stress test, requiring borrowers to qualify under a higher rate. The rule only applies to newly originated mortgages and is designed to prevent borrowers from taking on more debt than they can handle if interest rates go up. Since its passing, buyers’ worries are growing according to the survey. Half of Canadians (51%) say they are specifically concerned that stricter rules will prevent them from qualifying for a mortgage, up five points since 2018.

Steve Garganis, lead mortgage planner with Mortgage Architects in Mississauga, said that the concerns have risen due to more information flowing to consumers.

“Canadians are surprised to learn that even a large down payment won’t guarantee you a mortgage approval. Got 30%, 40%, 50%, 60% down payment and great credit? Guess what?  You still may not qualify for a mortgage. This is ridiculous, in my opinion,” Garganis said. “Those of us with years of experience in risk mitigation and credit adjudication know that if you have a large down payment, the chances of default are slim and none. Chances of any loss to the lender is nil.”

Younger home shoppers also feel the weight of the law. Sixty-nine percent of younger home shoppers, those between 18-34 years old, are concerned about qualifying for a mortgage under the stricter guidelines. This worry is also present for current renters who may be considering the purchase of their first home: 66% express concerns about mortgage qualification under stricter guidelines.

This despite a recent CMHC survey that found homebuyers were overwhelmingly in favour of the stress test, agreeing that the measure would help prevent Canadians from shouldering mortgages that they couldn’t afford.

Garganis added that more Canadians are being forced back to the six big banks, as smaller lenders now have more costs in raising funds to lend. This results in Canadians paying more than they should.

Most people have heard the buzz word “stress test” but don’t really know what it means or know the specifics of what it did, said Jeff Evans, mortgage broker with Canada Innovative Financial in Richmond, B.C. He thinks that the higher qualifying standard is “quite unreasonable,” and that the government has “taken a hatchet to anything to do with helping the average Canadian to own a home.”

Evans says that Canadians have a right to be concerned, although there’s no sign of their concerns hampering their desire to purchase a home.

“Life has gone on. They qualify for less, the market has gone down primarily because of the changes the government has made, so it’s starting to get more affordable again and people are gradually coming into the market as it becomes more affordable, “Evans said.

Other perceived barriers to home ownership include coming up with a down payment (66%), debt (56%), lack of job security (47%), property taxes (46%), not being in a position to settle down (15%), or not being enough homes for sale (13%). Only 8% of Canadians claim not to see any barriers to owning a home.

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Young Homebuyers Are Vanishing From the U.S.

The median age of first-time home buyers has increased to 33, the oldest in records dating back to 1981, according to a National Association of Realtors report released Friday. The median age of all buyers also hit a fresh record, 47, increasing for a third straight year — and well above the median age of 31 in 1981.

Getting Older

The median age for all U.S. homebuyer profiles is creeping higher

Click link to see graph: https://www.bloomberg.com/news/articles/2019-11-08/young-homebuyers-vanish-from-u-s-as-median-purchasing-age-jumps

Note: Survey conducted almost every other year prior to 2002. No data for 1983 and 1999.

While the median age of first-time home buyers only rose by one year, the increase reflects a variety of factors facing Americans searching for a home.

A nationwide shortage of affordable housing, coupled with lower mortgage rates, has stoked prices in cities from the coasts to the heartland. At the same time, student loans and other debts make it harder for Americans to save tens of thousands of dollars for a down payment, while tight lending standards can make getting a bank loan difficult for borrowers with less-than-stellar credit scores.

“Housing affordability is so difficult today, especially when coupled with rising rents and student loan debt, that they’re finding different ways to enter home ownership,” said Jessica Lautz, vice president of demographics and behavioral insights at the Realtors group in Washington.

The characteristics of home buyers have changed in recent years. The share of married couples has declined as unmarried couples and those purchasing as roommates has risen.

As buyers’ ages have increased, so have their incomes. The typical income of purchasers rose to $93,200 in 2018 as a lack of affordable options squeezed lower-income potential buyers out of the market.

Higher prices of homes have also changed how first-time buyers are entering the market. Nearly a third of first-time home buyers said they used a gift from a relative or friend to fund their down payment.

Builders have cited a shortage of affordable lots and labor as reasons to build fewer or bigger single-family homes, leaving America’s growing population to consider more of the existing housing stock. New homes as a proportion of all purchases fell to a low of 13% in records dating back to 1981.

The report reflects survey responses from 5,870 people who purchased a primary residence in the period between July 2018 and June 2019.

Source: Bloomberg.com – By 

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Here’s Where You Can Buy a Home if You Make Less Than $50,000 a Year

 

The conversation around homeownership in Mississauga and surrounding cities has been a challenging one, especially as prices remain high across all housing types in the city and surrounding municipalities (in fact, the average 905 condo is selling for over $400,000 and has been for sometime now).

But while it’s frustrating for experts—and non-experts who entered the market years ago—to tell prospective homebuyers that they’ll have to move to find an affordable housing, some people might be interested to know that there are indeed still places in Canada that offer affordable homes for single buyers with more modest salaries.

And a recent Zoocasa report reveals where solo homeowners-to-be on a budget might be able to purchase a home.

“While having a dual-income household can greatly improve purchasing power and the ability to qualify for a mortgage, that’s not to say homeownership isn’t in the cards for single-income earning buyers. In fact, according to recent calculations by Zoocasa in celebration of Single Awareness Day (February 15), there are a number of markets where it’s possible to buy a home on one income – and even have money left over,” says Penelope Graham, managing editor, Zoocasa. 

Graham says that, to determine which markets were affordable, the average and benchmark home prices were sourced from regional real estate boards. It was then assumed the buyer would make a 20 per cent down payment and take out financing with a 3.29 per cent interest rate amortized over 30 years, to determine the minimum income required to qualify for a mortgage on the average home.

Those findings were then compared to median income data of “persons living alone who earned employment income” as reported by Statistics Canada.Buying Single - Income Gap - Age 25-64

  • Buying a Home Single - Age 25 to 34
  • Buying a Home Single - Age 35 to 44

Buying a Home Single - Age 45 to 54

So, where can solo buyers most easily afford a home?

Overall, single home buyers will see the best bang for their buck in Eastern Canada and the Prairie provinces, with Regina taking top spot out of 20 cities for greatest affordability.

There, a single buyer earning the median income of $58,823 would enjoy an income surplus of $20,025 on the average priced home of $284,424.

That’s followed by Saint John, where someone earning the median of $42,888 would see a surplus of $18,038 on a $181,576 home, and Edmonton, where earning $64,036 would net a $17,826 surplus on the average home price of $338,760.

MLS listings in Calgary, Lethbridge, Winnipeg, and Halifax also fall within the realm of affordability for single-income purchasers.

So, where are single buyers less likely to purchase a home? As expected, Zoocasa says the Greater Golden Horseshoe (which includes Toronto and the GTA), is out of most people’s budgets.

Graham says a buyer earning the median of $50,721 would fall a whopping $88,361 short on the average $1,019,600 for MLS listings in Vancouver. Toronto real estate listings are the second-least affordable with an average home price of $748,328; a buyer earning $55,221 would face an income gap of $46,858.

Victoria is the third least affordable with an average home price of $633,386, still $39,359 above what the relatively high median income of $86,400 could afford.

Other markets not considered affordable for single buyers include Guelph, Kitchener-Waterloo, London, Montreal, and Ottawa.

Naturally, the housing market is more difficult for single millennials to navigate.

Zoocasa says the research also compared how earnings ranged by age group per location, and which demographic enjoyed the greatest affordability when purchasing a home. Across every market, Gen Xers (35 – 44 and 45 – 54 age brackets) enjoy the greatest earnings and purchasing power, with 11 markets considered within affordable reach (compared to 10 markets across all age groups).

Millennials (aged 25 – 34) had the least earning power in each city, behind Boomers (aged 55 – 64).

Overall, single home buyers aged 35 – 44 purchasing a home in Regina enjoyed the greatest affordability of all, with an income surplus of $24,215. A millennial purchasing in Vancouver had the least, facing a gap of $92,774.

Check out the infographics below to see which Canadian housing markets are most affordable for single buyers, courtesy of Zoocasa.

  • Buying a Home Single - Age 55 to 64

Top 5 Most Affordable Housing Markets for Single Home Buyers


1 – Regina

Average home price: $284,44

Income required: $38,798

Actual median income: $58,823

Income surplus: $20,025


2 – Saint John

Average home price: $181,576

Income required: 24,769

Actual median income: $42,888

Income surplus: $18,038


3 – Edmonton

Average home price: $338,760

Income required: $46,210

Actual median income: $64,036

Income surplus: $17,826


4 – Saskatoon

Average home price: $290,736

Income required: $39,659

Actual median income: $55,758

Income surplus: $16,099


5 – St. John’s

Average home price: $295,211

Income required: $40,270

Actual median income: $51,964

Income surplus: $11,694


5 Least Affordable Housing Markets for Single Buyers

1 – Vancouver

Average home price: $1,019,600

Income required: $139,082

Actual median income: $50,721

Income gap: $88,361


2 – Toronto

Average home price: $748,328

Income required: $102,079

Actual median income: $55,221

Income gap: $46,858


3 – Victoria

Average home price: $633,386

Income required: $86,400

Actual median income: $47,041

Income gap: $39,359


4 – Abbotsford

Average home price: $590,900

Income required: $80,604

Actual median income: $46,714

Income gap: $33,890


5 – Hamilton-Burlington

Average home price: $550,058

Income required: $75,033

Actual median income: $51,253

Income gap: $23,778

Source: Insauga.com – by Ashley Newport on November 1, 2019
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