Published on September 23, 2022 at 3:57 p.m.
With house prices falling in recent months, a family will now need to make $167,500 a year if they plan to buy a home in Hamilton.
New data from Ratehub.ca, an online portal that allows users to compare mortgage rates, shows that the level of income needed to buy fell by $11,500 from June to August this year. The reason for the decline is attributed to home prices falling over the same period from $72,400 to an average of $862,300.
The $167,500 rate is based on those who can afford a 20% down payment.
The increased affordability in Hamilton is indicative of trends across the country, as Ratehub data points to a similar decline in 10 other major Canadian markets.
“Houses in every city we looked at are slightly more affordable than they were two months ago. Indeed, rates have remained unchanged, while house prices have fallen,” says James Laird, co-CEO of Ratehub.ca and president of mortgage lender Canwise.
The affordability factor has been in a state of flux in Hamilton this year. In March, $170,400 was needed to buy a house and this figure rose to $179,060 in June. The current number of $167,500 is the lowest it has been in 2022.
The bottom line, according to the report, is that even though house prices are falling, mortgage rates have risen in response to rate hikes by the Bank of Canada.
“While significant declines in house prices have now managed to offset rising rates, leading to somewhat improved affordability, it remains crucial to shop around for the best mortgage rate available,” the report concludes.
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