Is it cheaper to rent or buy a house with a monthly mortgage in Canada? Prices analyzed in 26 marketsto rent or own a home"In this climate of rising rents and declining mortgage rates, Canadians are wondering if this year is the year to buy or rent," the report published Tuesday read.To compare the costs of renting and owning, Zoocasa made some assumptions for consistency in its report.
The mortgage amounts were based on the five-year fixed mortgage rate and are not reflective of current rates. A Zoocasa spokesperson said in an email a potential buyer's actual mortgage rate would depend on their financial circumstances. With an average home price of $400,000, Edmonton was found to be the next most-affordable market for mortgage payments, with $1,697 being the average monthly payment in December, for a buyer starting a new mortgage based on the rate that month.Halifax, Montreal and Saskatoon also had a relatively small gap between monthly mortgage and rent, with mortgage payments being up to $500 higher than rent in those cities, the report noted.
"House prices would need to go down by about 60 per cent, they need to be really about a third of what they are across Canada" for most people to be able to afford a home, she said. "They were saying if home production more than tripled, you might get housing to a less unaffordable level, so pure supply isn't going to make homeownership affordable," Whitzman said.
"The whole system was set up in the early 1970s, with the thought that you didn't need to have a really good pension plan because all you needed to do was save up and sell your house at the right time," she said.
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