How much income do I need to qualify for a mortgage in Canada? + MORE May 18th

When my husband and I bought a house with my mom in 2015, it was a leap of faith for everyone involved—but we had a plan. We’d turn the unfinished basement into a stunning living space for my mother and we would live upstairs with our two young kids. It was a win-win situation: My mom would get a brand-new suite designed to her specifications, and we’d have plenty of room for our growing family. Plus, since we planned on sharing the cost of utilities and other house-related expenses, we’d all save some money in the long run.

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After speaking to several contractors and having floor plans drawn up by an interior designer, we were told to budget approximately $90,000 for the renovation. While we knew our project list was substantial—a full kitchen, bedroom, ensuite bathroom, living room, laundry facilities and storage closets—that large number was still hard to swallow…

After several years of sky-high borrowing costs, mortgage rates are (finally!) starting to ease up. That’s great news for cash-strapped Canadians currently shopping for the best mortgage rate—but it unfortunately hasn’t translated into improved affordability when buying a home.

The national average home price came in at a hefty $703,446 in April, according to the Canadian Real Estate Association (CREA). While that marks a slight 1.7% dip from the same time period last year, it means today’s home buyers are shelling out $200,000 more to buy an average-priced home than they would have five years ago.

The short-term affordability picture isn’t looking any rosier. The latest monthly affordability study from Ratehub.ca finds that borrowing conditions got tougher in 10 out of 13 of Canada’s major housing markets in April, largely due to month-over-month growth in home prices. (Ratehub and MoneySense are both owned by Ratehub Inc.) 

The study determines affordability based on the minimum income required to buy an average-priced home based on regional real estate data, as well as mortgage and stress test rates…