A BC city is outpacing Vancouver when it comes to how much income is required to buy a home.
While the total income required is still higher in Vancouver, according to Ratehub, Victoria saw the most significant change in income needed between April and May.
Victoria also saw a more significant jump in home prices than Vancouver.
“A combination of stagnant borrowing costs and growing home values further put the squeeze on home buyers in May,” Ratehub says in its report.
Ratehub says that Vancouver saw average home prices jump from $1,206,500 to $1,212,000 (+$5,500) between April and May. Vancouver leads all of Canada in this category. The average home price in Victoria jumped from $866,700 to $874,300 (+$7,600).
Vancouver also leads all of Canada regarding the income required to buy a home by a large margin.
In April, based on a stress test rate of 7.50% and a mortgage rate of 5.50%, the income required to buy a home in Vancouver was $232,150. That jumped by $800 in May based on a stress test rate of 7.49% and a mortgage rate of 5.49%.
Meanwhile, in Victoria, the income required to buy a home in April was $170,950, and in May, $172,180, a jump of $1,230 compared to the $800 jump in Vancouver.
Ratehub.ca (See the full chart here).
Across Canada, the capital of BC saw the second-largest jump of all major cities in home prices and income required to purchase a home, trailing only Hamilton, Ontario.
Ratehub warns that an impending rate cut “could further heat summer home prices.”
“A number of real estate boards – including the Canadian Real Estate Association – are forecasting an increase in sales in the coming months, as buyers are encouraged by easing borrowing costs,” Ratehub adds.