Households Qualifying to Buy Median Dwelling

This map estimates the proportion of households in each area that would qualify to purchase the median dwelling value in that area. Compare this to the related map of how many can afford to pay the median rent, as well as the map of households that can afford typical monthly owner payments. We compute the qualifying income to purchase a house by assuming a 20% downpayment and 30% of pre-tax income being used to pay the mortgage. This is a more lenient criterion than usually employed where property taxes and strata fees and utilities are also included to fit below the 30% cutoff. For an exact definition of how the qualifying income is computed see at the bottom. To estimate the proportion of households qualifying we utilize the brackets of pre-tax household incomes and assume that the distribution is linear in each bracket and that for the top bracket of income above $150,000 half of the households always qualify and the other half has incomes linearly distributed between $150,000 and some estimated "halfway" mark in the top income bracket. The variations between and within metropolitan areas in Canada is startling. In Metro Vancouver, where overall 31% of households can purchase the median home, we see strong variability on the municipal level. In the City of Vancouver only 18% of households qualify to buy the median home, compared to 52% in Langley. Metro Toronto fairs radically better, with 52% of households qualifying for the median home. Even focusing in on the City of Toronto we still have 46% of households qualifying for the median home there. In Metro Montreal 59% of households qualify for the median home, but only 38% when focusing in on the City of Montreal. Metro Calgary comes in at 63% of households qualifying to by the median home, 62% when considering only the City of Calgary, to be topped by Metro Edmonton with 66% of households qualifying, dropping down to 62% to tie Calgary at the city level. As always, our maps are Canada wide. Pan, zoom and use the search bar to explore different parts. Zooming into the sub-neighbourhood level leads to data-quality issues due to statistical rounding, and we grey out areas where we deem the data to be unreliable. For added information we show the relationship between the proportion of owner households and the proportion of the households qualifying in each area. As one would expect, these correlate quite strongly in Calgary, Montreal and Toronto, but the correlation is much weaker in the Vancouver area. Qualifying Income The formula used to estimate the qualifying income for a dwelling with purchase price `x` is ``` 0.8 x / (100000/400/12) 100 / 30 ``` using that the mortgage covers 80% of the purchase price, the rule of thumb that $400 of monthly mortgage payments can finance a $100,000 loan, and that 30% of income should be used to make payments.

Author: CensusMapper Team

Dataset: CA11F, CA11N