Owning a home is more accessible than you might think, especially if you look beyond Toronto and Vancouver. Attention-grabbing headlines highlighting pricey homes in Canada’s most expensive cities have led many renters nationwide to conclude that owning a home is simply out of reach.
However, 75 percent of major Canadian cities are currently undervalued, with Regina, Winnipeg and Edmonton leading the affordability charge. That’s according to the 2020 RE/MAX Housing Affordability Report, which measures a number of key factors, such as average monthly wages and down payment sums, to determine how they impact the home-buying capabilities of Canadians in each market.
“Despite the many challenges that continue to plague Canadians when it comes to the prospect of home ownership, such as record debt loads, there is promising opportunity across the country to enter the market,” says Christopher Alexander, regional director and executive vice president, RE/MAX Ontario-Atlantic Canada.
Here we take a closer look at the most affordable cities for home buyers in Western Canada and expensive markets where buyers are getting creative to nab their dream home.
Photo: James Bombales
Regina’s oversupplied housing market bucks the national trend
Saskatchewan’s capital city is currently experiencing an oversupply of listings. This is welcome news for buyers in Regina, who have plenty of affordable options to choose from. On average, you can scoop up a home in Regina for $301,473. With an average yearly household income of $113,370, monthly mortgage payments would eat up only 12 percent of your monthly income — the lowest rate of any of the cities that were surveyed.
Winnipeg is “One Great City” for buyers on a budget
If the cramped condo lifestyle just isn’t for you, consider a single-detached or semi-detached home here, where the average sale price in 2019 was a reasonable $281,105. Of the 68 percent of Canadians who do not currently own a home and do not feel they will be able to afford one in their desired neighbourhood, 26 percent say their salary is not enough to save for an adequate down payment. That’s certainly not the case in Winnipeg, where a 25 percent down payment will only set you back around $71,681. The average age of first-time home buyers in the city is between 35 and 40, allowing Winnipeggers to save for longer, and resulting in lower monthly mortgage payments and interest.
Photo: James Bombales
Edmonton is bouncing back, albeit slowly
First-time home buyers in Edmonton should get into the market while they can. The city saw a modest 0.5 percent increase in residential sales this January, but overall, it’s still very much a buyer’s market with ample housing supply. The average sale price of a home in 2019 was $353,657, significantly less than in nearby Calgary, where homes fetched $484,601 on average. Although average yearly household incomes in Edmonton and Calgary are relatively the same, your dollar will stretch much farther in “The Festival City.”
Buyers in Vancouver and Victoria are getting creative
On the west coast, Vancouver holds the title of the “most unaffordable city in Canada” with the average sale price of a home in 2019 at $1,195,923. “All levels of government must work together to find a solution to Canada’s inventory issue, as the market will remain elusive for many otherwise,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “In the interim, working with experienced, professional agents can provide insight into creative and effective ways to navigate the current housing landscape. The recent changes to the mortgage stress test is expected to make the home buying process a bit easier for first-time buyers.”
Buyers on a budget should look to the areas of Collingwood, Hastings and Renfrew, which were identified in the report as the most affordable neighbourhoods to buy a home in Vancouver. Co-ownership with friends and family was also cited as a way for would-be Vancouver buyers to get on the property ladder.
On Vancouver Island, homes in the capital city of Victoria posted an average sale price of $717,100 in 2019. Following a lull in sales activity caused by the introduction of the mortgage stress test, prices in Victoria have moderated, meaning more would-be buyers may be able to enter the market. House hunting in the communities of Langford, Sooke and Colwood could yield better savings for buyers in search of affordable options, according to the report.
The bottom line – look to the Prairies for the best value.