Median-income earners would have to save 20 per cent of their salary for 52 years to afford a home in Greater Vancouver, according to a new study.
Calculations released by real estate agency Zoocasa on Thursday found that median-income households earning $72,662 in the region, where the benchmark home price costs $993,300, would qualify for a mortgage of only $241,994.
This would leave a shortfall of $751,306, necessitating a hefty down payment with a savings timeline that spans decades.
Overall, the study found median-income earners would not be able to afford homes in about half of Canada’s major housing markets.
In seven of 15 urban centres, such as the Fraser Valley in B.C. and Greater Toronto Area, median-income households would not qualify for a mortgage large enough to fund their benchmark home purchase.
In the eight other markets, such as in the Prairies as well as parts of the Maritimes, the study said median-income households would be able to save up the required down payment in less than a decade.
For the study, Zoocasa calculated the maximum mortgage that median-income households would qualify for in each region, assuming a three-per-cent interest rate and 25-year amortization, and that the equivalent of one per cent of the total home purchase price would be put toward annual property taxes.
An additional $100 per month for heating costs was also factored into the calculation.