Buying a home is out of reach for many Canadians (Photo generated through AI).
The cost of homes in Paris, Lisbon, and New York City puts them out of reach for many people.
Toronto, too, has affordability issues that force buyers to look elsewhere.
But would you have guessed that Brampton and Mississauga are also among the 20 least affordable places in the world to buy a home?
That is the finding of a recent analysis of global home prices that places the three Ontario cities in the same class as some of the world’s most famous living destinations.
To give it further perspective, it is more difficult for people who live in these Ontario cities to purchase a home than it is for those who live in Madrid, London and Barcelona, other cities that made the list.
Undertaken by Remitly, a money transfer service that assists buyers with home purchases around the globe, the rankings looked at 151 cities and took into consideration property prices, average salaries, mortgage rates, interest rates, down payments/deposits and more to unearth where the most and least affordable places to purchase a home are.
The list provides information for both a single person and couples and shows the percentage of how much of an average home they can afford in their own community based on their average income.
Topping the list of least affordable is San Jose, California, where some of the world’s biggest tech giants can be found, but the home prices are so high that buyers struggle to purchase, even though income levels are high.
“Our study reveals that even a couple who earn the local average salary ($86,605), pooling their funds together, would barely be able to afford half (54.6 per cent) of the average property,” says Remitly. “This could mean they would have to stretch themselves financially, often finding larger down payments or asking for financial help from family to be able to make their dream of owning a home a reality.”
In fact, California is a hard sell in general, with four other locations aside from San Jose rounding out the top five.
They are Los Angeles, Long Beach and San Diego, in that order.
The least affordable city in Canada is Vancouver, coming in at fifth position on the list.
“Our study shows that a single buyer, earning on average $54,778, would be able to afford 34.9 per cent of an average property, and even a couple can only afford almost 70 per cent, meaning those wanting to settle down in the city either have to rely on large deposits, help from family, or turn to the rental market instead,” says Remitly about Vancouver.
That brings us to Ontario.
Sitting at number 12 in the world rankings, Remitly says that an average-income single person can only afford 41.5 per cent of a home and that a dual-income family can only afford 83 per cent of an average property
Mississauga is ranked 13th of the 20 least affordable cities in the world.
What puts Mississauga on the least affordable list is that a single person is only able to afford 42.7 per cent of an average home, while the contributions of two people push that number to 85.5 per cent…not quite 100 per cent and therefore not affordable. Remitly data also indicates that Mississauga is the tenth most expensive place to buy a home in North America.
As for Brampton, Remitly says the average single person can afford 44.7 per cent of an average home in that city. The combined income of a couple comes out to 89.4 per cent of affordability.
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