In spring of 2022, house prices sky-rocketed and the average Canadian spent a whopping 63% of their annual income on their mortgage. And, despite home prices falling the second half of 2022 and into 2023, it hasn’t necessarily become more affordable to buy a home. As the Bank of Canada started hiking interest rates, stress test rates and monthly mortgage payments also took a big hike.

What does that mean if you’re looking to buy in 2023? Let’s get into the nitty gritty and look at just how much it costs to buy in some of Canada’s biggest cities.

Toronto

First up on the list is, arguably one of the most popular cities in the country, Toronto. Everyone loves Toronto, but not necessarily the price-tag of living there. Due to its popularity, size, services offered, and opportunistic job market, it’s not all that surprising that Toronto has one of Canada’s most expensive housing markets. We did see prices drop from some sky-high prices at the start of 2022, and now the average single detached family home in the GTA is sitting around $1,051,216 (Toronto Housing Market Report). Data suggests that with a home price point over a million dollars, homebuyers will need to be making an annual salary of around $200,000, especially if looking to put down a 20% down payment for a place in the city. For a 20% on the average home price in Toronto you’re looking at about $210, 243. Toronto has always been a more expensive market and because of that many people preferred to purchase in the Greater Toronto Area, also known as the GTA, as a more affordable option while still living within close proximity to the city. The GTA consists of a total of 25 urban, suburban, and rural municipalities. Over the past couple of years home prices in the GTA have also spiked considerably. Brampton, a popular city in the GTA, average sold price is just under a million, sitting at $981,920, and would require a $196,384 20% down. If you’re considering moving to Toronto, or even to the GTA, you’re going to need around at least $200,000 plus for 20% down payment. Plus, around $4958 for a monthly mortgage payment on a 25 year mortgage at 5.14% rate.  

Vancouver

Not surprising, Vancouver still tops the list as the most expensive city to purchase a home in Canada. Vancouver has long topped lists as one of the most desirable cities in Canada to live in. Such desirability does come at a price. And to put a number on that desirability, the average home price in Metro Vancouver sat just above 1.8million by the end of 2022 (Mortgage Sandbox) which would require $360,000 for a 20% down payment. For many perspective buyers a detached single family home in Vancouver is out of the question based on price point alone. For this reason, many are turning to condos as a more affordable option. As a popular choice among many in the city, the benchmark price for condos have actually increased by 1.7% year-over-year to $714,000 (Vancouver Housing Market Report). Homebuyers would need $142,800 for a 20% down on a Vancouver condo. Perspective buyers, looking to put down 20% on a place, should be prepared to handover between $142,800 - $360,000 plus along with approximately $3858 to $8,490 per month on a 25 year mortgage depending on home type.

Ottawa

If you’re looking to buy in the nation’s capital how much do you need? The average home sale price in Ottawa is sitting at $606,227 (Ottawa Housing Market Report) which will cost around $121,245 for a 20% down payment or $30,311 for a first time homebuyer looking to put down 5%. A 20% down on the average home price in Ottawa would come with an approximate monthly mortgage of $2777 on a 25 year mortgage at 4.84% with a 5-yr/fix. While considerably cheaper than Toronto and Vancouver, Ottawa was hit hard during COVID-19 and saw home prices spike a staggering 65% from 2020 to 2022, making it a much less affordable city for many. Since the pandemic frenzy has cooled, Ottawa has returned to being a relatively affordable major city in Ontario and is quite an attractive option for many perspective buyers. Like many cities, Ottawa has seen an increased interest in condominiums and the average annual condominium cost has continued to grow with the average condo in the city costing $434,973. A condo in Ottawa would cost about $86,994 for 20% down or $21,748 for a 5% down. The average salary in Ottawa is approximately 15% higher than the national average (hello government city) and with home prices being more affordable than other major cities, it may make home ownership in Ottawa slightly more attractive and attainable.

Calgary

Prices are continuing to rise in the wild west with the average detached home in Calgary going for around $639,000. That is about an 8.8 year-over-year increase (Calgary Housing Market Report).  That’s about $127,800 for a 20% down payment and a monthly mortgage of $2927 on a 25 year mortgage at 4.84%. Some are predicting that the average detached home may pass the $700k benchmark this year, requiring approximately $140,000 for that 20% down. Because the Calgary housing market doesn’t need to correct itself the way many other provinces needed to post pandemic, Calgary is one of the few cities that is seeing a healthy number of upward trends, including price increases on all forms of housing (detached, semi-detached, townhome, and condominiums). The condo market in particular has grown quite hot in Calgary the past year with an 8.2% year-over-year increase to $283,000 (Calgary Housing Market Report). An average condo price with 20% down would require $47,600 or $11,900 for a 5% down with a first time homebuyer. Compared to the rest of the country both detached homes and condos are considered to be quite affordable. Many real estate investors are moving into the Calgary housing market to capitalize on these prices along with Alberta’s favourable income tax rates. It is also not surprising that the Calgary is seeing a surge of people from other provinces migrating into the city. While Calgary is having a moment of high demand, it is also facing a low supply of houses on the market, keeping current prices steady.