Want to own a home in Hamilton? Here’s the minimum salary you’ll need

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Published November 16, 2022 at 1:03 pm

Technically, home ownership has become slightly more affordable in Hamilton — a nationwide trend. But what kind of salary will it take to buy a home today?

In a technical sense, home ownership has become slightly more affordable in Hamilton — a nationwide trend.

While “affordable” is a subjective word, the minimum annual income required to buy a home in Hamilton has decreased, according to Ratehub.ca’s latest affordability report.

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Using real estate data from October and a 5.44 per cent interest rate and 7.44 per cent stress test rate, the report suggests a minimum yearly salary of $164,800 to be able to afford the average home in Hamilton, which sold for $836,800 last month. Compared to Ratehub.ca’s June report, the minimum salary decreased by more than $14,000.

“Homes are becoming more affordable across the country,” says James Laird, co-CEO of Ratehub.ca and president at Canwise mortgage lender. “With the Bank of Canada suggesting that rate hikes are nearing an end and the continued softening of home prices, affordability should continue to improve in the coming months.”

“June 2022 will likely prove to be the low point for affordability since mortgage rates were up while home prices had not yet softened significantly,” he added. “As affordability continues to improve, we will likely see homebuyers resume their search in the new year. We will have to see if sellers are interested in listing their homes at values that are significantly lower than their peak.”

Ratehub.ca’s report analyzed ten Canadian cities and found they require less income to afford a home in October compared to August. Although Vancouver remains the most expensive city in Canada to buy a house, it is also one of the cities where home prices have declined the most substantially over the last few months.

Want to own a home in Hamilton? Here's the minimum salary you'll need

With the Bank of Canada signalling that the worst of the rate hikes may be behind us, Ratehub.ca says there is room to be cautiously optimistic about the state of home affordability.

“Falling home prices combined with relatively stable (though high) mortgage rates mean that affordability is likely to continue to improve over the remainder of 2022 and into 2023,” they added.

The full report from Ratehub.ca can be found online.

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