Saving up for a home can take some time, and a new report has outlined the change in the prices for a house in Edmonton, rising by more than $4,000 last month alone.
The report from Ratehub.ca calculated the minimum annual income required to buy an average home in some of Canada’s major cities based on April and May 2024 real estate data.
The report details how changing mortgage rates, stress test rates, and real estate prices are impacting the income required to buy a home.
In April, Edmontonians hoping to buy a home needed to make $84,850 per year. That increased slightly in May to needing $85,450 in take-home pay.
Home prices in Edmonton also increased over the previous month (up $4,200) to $392,700.
Ratehub.ca
At the start of the year, the house prices in Edmonton were at an average of $370,100, with an increase of $22,600 so far this year.
Our neighbours to the south in Calgary saw an even bigger increase in house costs (up $6,200), with the average income required to purchase a home in that city rising by $1,020, per the report.
“Despite little upward pressure on the borrowing side – the average five-year mortgage rate remained fairly flat on a monthly basis at 5.49% compared to 5.5% in April – rising home values were steep enough to push affordability further out of reach for many. The mortgage stress test, meanwhile, remains elevated at 7.49%,” Ratehub.ca added.
Data in the Ratehub.ca chart is based on a mortgage with 20% down payment, 25-year amortization, $4,000 annual property taxes and $150 monthly heating. Mortgage rates are the average of the Big Five Banks’ 5-year fixed rates in May 2024 and April 2024. Average home prices are from the CREA MLS® Home Price Index (HPI).
One silver lining, however, is that Edmonton was just named the most affordable big city in Canada. Things could be worse, we guess.