Lower home prices and mortgage rates improved August affordability: report

[Pelican Press 0]

This is the hidden content, please

• Sign In
• or
• Sign Up

Lower home prices and mortgage rates improved August affordability: report

Descrease article font size

Increase article font size

Easing home prices and drops in interest rates helped to reduce the income needed to buy a home in most major cities across Canada last month, a new Ratehub report shows.

data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///ywAAAAAAQABAAACAUwAOw==

Comparator site Ratehub.ca

This is the hidden content, please

• Sign In
• or
• Sign Up

that August saw declines in the minimum income needed to buy the average home in 12 of the 13 cities included in the survey.

The biggest improvements were seen in some of Canada’s most expensive housing markets, according to the report, including Toronto, Victoria and Vancouver.

For the second consecutive month, Toronto led the way in affordability improvements, Ratehub said. The minimum annual income for a household to afford the average home in Toronto was $204,100 in August — still lofty, but down nearly $5,000 from July’s levels.

data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///ywAAAAAAQABAAACAUwAOw==

Get weekly money news

Get expert insights, Q&A on markets, housing, inflation, and personal finance information delivered to you every Saturday.

The drop came as the average home price declined more than $15,000 month to month. Slow sales and a glut of supply, particularly in the condo market, helped to put downward pressure on home prices in Toronto over the summer.

Story continues below advertisement

This is the hidden content, please

• Sign In
• or
• Sign Up

/applications/core/interface/js/spacer.png">

2:20
Business Matters: Analysts say wave of mortgage renewals driving owners to list homes

Even in some markets that saw prices appreciate in August, declines in interest rates helped to lower the barrier to afford a home.

Trending Now

• data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///ywAAAAAAQABAAACAUwAOw==

  Cineplex slapped with record $38.9M fine over online booking fee

• data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///ywAAAAAAQABAAACAUwAOw==

  Woman ***** in ‘******** pod’ in Switzerland, several people arrested

Ratehub said the average five-year fixed mortgage rate in August was 5.16 per cent, down from 5.29 per cent in July.

St. John’s, N.L., was the only city included in the survey to see income requirements rise in August thanks to a $4,900 jump in the average home price. Here, the annual income needed ticked up by just $160.

Mortgage rates have been trending lower nationally thanks largely to the Bank of Canada’s interest rate easing cycle, which has seen the central bank cut its benchmark rate three times since June.

National Bank of Canada said in its housing affordability monitor last month that it expects falling interest rates will be the biggest driver in making homeownership more affordable for Canadians in the months to come.

Story continues below advertisement

But National Bank economists also warned that despite two quarters in a row of improvements, affordability has not returned to its pre-pandemic levels.

More on Money
More videos

&copy 2024 Global News, a division of Corus Entertainment Inc.

This is the hidden content, please

• Sign In
• or
• Sign Up

#home #prices #mortgage #rates #improved #August #affordability #report

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up