What can you afford? Crunching the real estate numbers for Burlington, Milton, and Oakville

 

Halton Region hasn’t been immune to the rising prices in the real estate market.

A total of 668 transactions occurred in November of this year, according to the Toronto Real Estate Board (TREB), marking a solid annual increase of 25%. Meanwhile, the average price rose 5.4% to $845,530 for the region as a whole.

But just how affordable is the local market for median-income buyers?

To find out, Zoocasa crunched the maximum mortgage a median-income buyer would qualify for in Halton's four major municipalities, based on the median home price as of November 2019, as well as the median income earned in each.

Burlington buyers who earn the city’s median income of $93,588 will find relatively good affordability in its condo sector, with the median-priced unit at $447,500, requiring just a 1.6-year savings timeline.

However, that timeline jumps to 5.6 years for townhouses, which cost $525,000, and 16.6 years to save for a semi-detached home at $707,500.

Detached houses would take a median-income buyer a full 31.9 years to save for, at a median price of $959,000.

Those earning the local median income in Milton of $104,730 would be able to afford a condo or townhouse on 1.6- or 1.2-year timelines, respectively, at median prices of $501,000 and $490,000.

In Oakville, those earning the city’s median income of $113,666 will get the biggest bang for their buck in the multi-family sectors; with the median-priced condo unit costing $537,000, buyers could be moving in within a 1.4-year timeframe.

Zoocasa compared the mortgage amount to the median home prices in each city to reveal the gap the home buyer would need to cover via a down payment. The study also crunched the number of years it would take a household to save for that down payment, assuming they set aside 20% of their income on an annual basis. 

To determine the mortgage amount, it was assumed the borrower would qualify for a 3% interest rate and a 25-year amortization. One per cent of the home's cost for property taxes, and a $100-heating bill, were also factored in. (Condo fees, loans, and other debt obligations were not factored into the calculation.)

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