Here's how long you need to save to buy a house or condo in Ottawa
A for sale sign displays a sold home in a development, in Ottawa, on July 6, 2015. (THE CANADIAN PRESS/Sean Kilpatrick)
OTTAWA -- People dreaming of buying a new house in Ottawa will need to save for three years to cover the down payment, according to a new report.
And if you want to buy a condominium, you will need to spend nearly two years saving to put down the down payment.
The National Bank of Canada’s Housing Affordability report looks at how long residents will need to save for a down payment, along with the estimated salary homeowners would need to afford it.
The report says the median cost of a home in Ottawa is $544,644, while the cost of a condominium is $338,014.
The qualifying household income for a home in Ottawa is $110,587, while the qualifying income for a condo is $68,929, the report says.
The survey looked at the number of months a median-income household will be require to save for the minimum cash down payment (six per cent) for a Canadian Mortgage and Housing Corporation-insured mortgage home, at a savings rate of 10 per cent of pre-tax income.
Assuming the homebuyers earning $110,587 a year saved 10 per cent, it would take 39 months to save the $29,464 needed to cover the six per cent down payment to buy a home.
If you’re buying a condo, it would take you 22 months of saving 10 per cent of your income to accumulate the $16,901 down payment.
The median household income in Ottawa is $90,625.
The National Bank of Canada report estimates it would take 408.5 months to save the necessary down payment to buy a home in Vancouver, where the median home price is $1.3 million.
It would take 289.5 months of saving to cover the $207,888 down payment for a home in Toronto.
“At a national level, there has never been a worse time to accumulate the minimum down payment,” said the report by Kyle Dahms and Camille Ballargeon.
“Assuming a savings rate of 10 per cent of total median household income, it would now take 60 months (five years) to save for the minimum down payment (approximately six per cent) of the representative home.”