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How Much Home Can Canadian Peak Millennials Afford in Montreal?

The average Canadian "Peak Millennial" makes just over $38,000 a year. Here's what kind of real estate you can buy in Montreal with that salary.

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A recent report by Royal LePage compares average income for Canadians aged 25 to 31 (peak millennials) with property prices across the country.

Peak millennials in Canada earn $38,148 a year on average, which would allow them to qualify for a loan of just over $200,000 under the new mortgage rules. A couple with a combined income of $76,000 would qualify for a home-buying budget of $400,000.

According to the report the most recent OSFI stress test has decreased purchasing power by approximately 16.5%, which amounts to $40,000.

Average home prices in Canada

The actual (not seasonally adjusted) national average price for homes sold in March 2018 was just over $491,000. On the other hand, the aggregate price rose up to $652,400, which means that many Canadian millennials will need to delay their home search or settle for less square footage.

What a young couple on a $400,000 budget can afford varies based on where they live.

In Vancouver, they would be able to buy a 1 bedroom condo under 800 square feet.

In Halifax, they could afford a 3 bedroom, 3 bathroom home of 1600 square feet.

For even more square footage they could buy a house in Moncton N.B, where the price of a home costs less than a 20% downpayment in Toronto or Vancouver.

In the more expensive cities across Canada, a growing number of peak millennials struggle to save the funds for a downpayment, despite being able to afford the monthly mortgage expenses. Over a third of young Canadians (35%) claimed to have received financial help from their families when buying a home, in the form of loans or gifts.

Others may qualify for homeownership programs which help fund the down payments of first time buyers and families.

Aggregate & Regional Home Attributes for Homes Between $325,000 and $425,0007
(For the three-month period ended March 31st)

City

Year

Beds

Baths

Living Space

Canada

2017

2.7

1.8

1,308 sq. ft.

2018

2.7

1.8

1,269 sq. ft.

Halifax

2017

3.1

2.4

1,787 sq. ft.

2018

3.1

3.0

1,736 sq. ft.

Ottawa

2017

3.0

2.2

1,487 sq. ft.

2018

2.9

2.3

1,495 sq. ft.

Calgary

2017

2.6

2.0

1,195 sq. ft.

2018

2.6

2.1

1,210 sq. ft.

Regina

2017

2.9

2.0

1,356 sq. ft.

2018

3.0

1.7

1,341 sq. ft.

Winnipeg

2017

3.0

2.0

1,482 sq. ft.

2018

3.0

2.0

1,413 sq. ft.

Greater Montreal Area

2017

3.1

1.7

1,468 sq. ft.

2018

2.9

1.5

1,344 sq. ft.

Greater Toronto Area

2017

1.6

1.4

816 sq. ft.

2018

1.7

1.4

856 sq. ft.

Greater Vancouver

2017

1.7

1.4

878 sq. ft.

2018

1.5

1.2

788 sq. ft.

 

What can Canadians on an average millennial salary afford in Montreal?

In the Greater Montreal area, heightened competition and limited inventory over the past few months have started to push prices beyond the means of most single millennials at the average income range.

As a result, many millennials are saving and waiting to combine their incomes with a potential life partner.

In the first quarter of 2018, a couple shopping in the GMA with a budget between $325,000 and $425,000 would be able to afford a condo averaging 2.9 bedrooms, 1.5 bathrooms and 1,344 sq. ft. of living space.

According to the latest (first quarter 2018) Centris data, the average single family home falls just beyond the reach of the average millennial salary, at $461,500. The average condo at $295,000 is well within budget for a couple, but above budget for an average single salary.

However, prices fluctuate significantly from borough to borough, and a detached home may be within reach in certain emerging or suburban neighbourhoods.

Millennials shopping as a couple on an average budget of $406,479 on Montreal Island can afford the average single family home in:

  • HOMA ($372,000)
  • Montreal North ($303,000)
  • Pierrefonds-Roxboro ($372,500)
  • PAT ($300,000)

Millennials shopping as a couple on Montreal Island can afford the average condo in all boroughs with the exception of:

    • Westmount
    • Outremont
    • Mont-Royal

 


This article, How Much Home Can Canadian Peak Millennials Afford in Montreal?, appeared first on Shupilov News.

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