It’s tough out there for anyone trying to buy or sell a house but it might be toughest for those aiming to be a first-time homeowner.
There’s hope for aspiring buyers as house prices are coming down, but mortgage rates are rising so fast that affordability continues to be an issue.
Add in the high inflation and the basic cost of living isn’t so basic.
Throw in the costs of purchasing a home (down payments, closing costs, mortgage payments, insurance, property taxes, not to mention any potential repairs or renovations) and it can be shocking for those who aren’t prepared for just how much of a financial strain owning a home can be.
But not everyone should lose hope — it just depends on where you are willing to live.
“Homeownership is more doable in some cities than in others,” according to a new report from online real estate marketplace Point2 , which shows just how much the costs vary across the country.
The report compares Canada’s 50 most-populous cities using data from two categories: upfront costs and annual recurring costs.
The Greater Toronto Area is not part of the “doable” ranks with some cities costing five times as much as locations in Quebec.
For example, the cost of the first year of ownership in Saguenay, Que. is $74,342 where Richmond Hill will run first-time homeowners $400,733.
Owning a home in Richmond Hill, Markham and Oakville requires a down payment of at least $265,000 whereas Saguenay, Trois-Rivières and Quebec City have down payments of less than $59,000.
The three aforementioned Quebec cities also boast the lowest annual mortgage payments — less than $18,000.
The Greater Sudbury Area, along with Edmonton and Calgary, gave the lowest closing costs (less than $2,000), unlike Toronto (nearly $29,000) and Vancouver ($23,215).
Analysts also looked at how many years it would take the average renter to save up for the upfront costs required to transition into homeownership, then went a step further and calculated how many years it would take to cover the full cost of the first year of homeownership.
There are new tax credits that Canadians can claim, like the first-time home buyers’ tax credit and the home accessibility tax credit, but those incentives, financial aid programs and “dwindling competition for already-scarce inventory” may not be enough for potential buyers.
St. John’s has the most affordable homeowners’ insurance ($780), as well as the second-lowest property taxes ($2,625).
According to the report, those in Edmonton take an average of five years to save up and cover all of the upfront costs but it can take 20 years or more in four Ontario cities (Richmond Hill, Markham, Oakville and Vaughan).
Whereas in Toronto and Burlington, it can take about 17 years, 16 years in Milton, Whitby and Mississauga, 15 years in Brampton and Ajax, and 13 years in Oshawa.
These are the top 15 of Canada’s 50 most-populous cities where the first year of homeownership would be the least expensive:
Québec City, Que.
St. John’s, N.L.
Greater Sudbury, Ont.
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