Reviews and recommendations are unbiased and products are independently selected. Postmedia may earn an affiliate commission from purchases made through links on this page.
Article content
Calgary has been one of Canada’s hottest real estate markets with growing demand increasingly making it costly for buyers to qualify for a mortgage, a new study has found. The report by Ratehub.ca, examining the income required to qualify for a mortgage for the average-priced home in respective markets, noted that the city saw among the largest increases in Canada.
Article content
To purchase an average-priced home in Calgary in May, cited as $587,100 in the study, a buyer required an annual income of $120,520, based on a 20 per cent down payment, and 5.49 per cent interest rate for a five-year fixed mortgage.
The caveat, however, is that buyers had to qualify for the OSFI (Office of the Superintendent of Financial Institutions) stress test, which is 200 basis points higher, or 7.49 per cent.
The income required increased $1,060 from April, the fourth largest jump in Canada.
That’s despite the mortgage rate decreasing from 5.5 per cent.
The study noted that the increase in qualification income is a result of the average price rising $6,200 in May from $580,900 in April — again, the fourth highest increase in dollar terms among cities.
Hamilton saw the largest increase in income required, up $1,550, with buyers needing $171,100 to qualify for a mortgage for a home with an average cost of $868,300, which increased by $9,400 from April to May.
Halifax saw the largest decrease in income required to qualify for a mortgage, falling $2,070 to $111,890, while the average price of a home fell $11,000 month over month to $539,200.
Share this article in your social network