Housing affordability has been the talk of the nation in recent years, especially as tighter mortgage regulations and higher borrowing costs have started to impact housing markets across the country.
A recent report by RBC Economic Research indicates that Calgary’s housing market isn’t out of reach for many potential homebuyers, especially when compared to the Vancouver and Toronto markets, as well as the Canadian average.
A Calgary home purchase income guide
Many would-be homebuyers find the home of their dreams, only to wonder, “can I afford it?” Canada Mortgage and Housing Corp., as well as many major banks, recommend spending no more than 30 per cent of income on housing, including mortgage (principal and interest), property taxes, insurance and utilities. To help, we did the math for a typical detached home in each region of the city. (more…)
Valuable information for prospective homebuyers
Canada’s new mortgage qualification rules and how they could affect you
On Jan. 1, 2018, new mortgage rules came into effect. Under the new rules, Canadian mortgages are subject to stricter qualifying criteria. Ultimately, this means some buyers will have to settle for less expensive homes than they could have qualified for prior to the rule change – up to 20 per cent cheaper in some cases.
All homebuyers must now go through the mortgage stress test:
How much home can you afford?
Shopping for the home of your dreams requires knowing how much you can afford to spend, which for most buyers ties directly into a mortgage.
Financial institutions in Canada look at a buyer’s Gross Debt Service (GDS) and Total Debt Service (TDS) ratios to help determine how much mortgage to approve, and therefore, how much home a person can afford.
How Calgary’s housing market stacks up against other major centres
When it comes to the housing market and the availability of affordable options, people often lose sight of the big picture. Instead of obsessing over the minute details of the market in any one particular city, it can be helpful to take a step back and examine things in a broader context to provide points of comparison. This dose of perspective helps one to remember that while $400,000 might seem like a lot to ask for a detached home in one city, in another major metropolitan area, people might be hard pressed to find a home for less than twice that amount. (more…)