The Average Family Home; It's Not For Your Average Family Anymore!

CREA says the average sale price of a home is now $496,500

The Canadian Real Estate Association stated that the average price of a home in Canada rose by 9.1% over the 2017 year.  This, in large part, was due to a serge of buyers and investors buying up the market in the early winter of 2017.  Over the past 6 to 10 months the government has stepped in and implemented new mortgage rules to cool the housing market.  We are starting to see the effects of these new mortgage rules as home sales statistics coming out of major urban markets are showing signs of slowing growth.  In the end it has effectively made it so the average Canadian can not afford the average home in Canada. This is how the numbers breakdown:

Average price of a home in Canada $496,500
Famlily income to qualify purchasing at $496,500* $81,000/yr
Current average family income $70,000/ry.

     The government has cooled the market yes, but in the overall picture they have made it so only the wealthy can afford a home. 

     1999 marked a new era for Canadians when the minimum downpayment was changed from 20% to 5% thus allowing more Canadians the chance at home ownership.  The government, at that time, realized how important homeownership was for all Canadians as it increased the overall economic health of the country.  Individuals who owned property were more likely to put pride of ownership into their home, into their neighbourhoods, and into their families.  When someone takes pride in something they tend to take care of it.  The average family was what made Canada a great place to live.  When you take away a persons right to homeownership you take away their pride. 

    Certain families surviving on less than average incomes can sometimes only qualify a purchase of $300,000.  In many major urban centres near and in the GTA homes that are in that $300,000 price range tend to be undesirable.  Moving to a less central area, where home prices may be cheaper, means commuting and that is not possible because the price of gas outways the cost savings of living outside the city.  So, after much home searching, a family is forced to rent because there is simply nothing suitable to buy.  When someone ends up renting there is no pride of ownerhip and they are less eager to tackle certain repairs or even simple decorating because it's not their home and they feel less inclined to do so.  So now it's the wealthy purchasing those average homes and in turn renting them out to average families. A landlord has no pride of ownership in a property; they simply see it as a commodity and will only do the basic upkeep of that property.   The end result is that more rented properties in a neighbourhood tend to make home conditions deteriorate, neighbourhoods deteriorate, and moreover values deteriorate.  We need back the government who cared about the average Canadian and made sure their basic need for shelter is met with possible means.  A hard working family with kids in Canada should never be forced to live in a less desirable home and neighbouhood because of government rules forcing them into that situation.  Everyone deserves the opportunity to live a better life and right now the Government of Canada has taken that away from us.

*all rates, numbers and averages are based on today's qualifying rate of 4.99% and using a 5% downpayment with a 25 year amortization.  Rates, numbers, & averages are subject to change without notice. O.A.C.

 





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