Calgary and affordability are strange bedfellows these days with respect to its resale real estate market. After all, average prices have continued to rise even amid falling sales, but a new study suggests the city’s housing market remains comparatively affordable, especially when accounting for median income. Read More
What makes Calgary’s homes more affordable than other parts of the country is residents’ relatively higher median income.
What makes Calgary’s homes more affordable than other parts of the country is residents’ relatively higher median income.
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Calgary and affordability are strange bedfellows these days with respect to its resale real estate market. After all, average prices have continued to rise even amid falling sales, but a new study suggests the city’s housing market remains comparatively affordable, especially when accounting for median income.
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“Calgary has always been among the more affordable cities because of the good-paying jobs,” says Toronto-based mortgage broker Victor Tran with Ratedotca, which published the recent report.
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The study compared annual median income with the income required to qualify for a mortgage for the average price of a home in six major Canadian cities at the end of 2024. It based its calculation using the stress test threshold of 200 basis points higher than the offered rate, which for the study was 4.7 per cent for a 25-year amortization, five-year fixed-rate mortgage. All calculations are based on the minimum down payment, five per cent on the first $500,000 of the sale price and 10 per cent for the remainder.
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In Calgary, where the average price was about $572,900, buyers required $129,000 to qualify for a mortgage at the stress test rate of 6.7 per cent.
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Yet Calgary median income, as cited in the study, was $147,643, or about $18,600 more than required.
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That’s the second largest sum over the minimum income required, trailing Edmonton where buyers had a median income exceeding required income by more than $50,000. There, the average price was $397,400, requiring an income of $91,000. Yet the median income was more than $141,600.
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Both Alberta cities have median incomes above the national average cited in the study of $124,617.
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Household incomes in both municipalities even exceed those in Toronto and Vancouver where median income falls well short.
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In Toronto, the median income is $133.947 annually. The average price was $1,061,900, requiring $232,000 for income, a difference of more than $95,000.
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Even nationally, the median income of about $124,700 is insufficient. The income required to qualify for a mortgage for the average price of a home nationally — more than $676,000 at the end of December — was $150,500, exceeding median income by $25,000.
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Despite a higher median income, affordability is a concern for Calgary buyers, says Justin Warthe, realtor and owner of Top Calgary Real Estate Team.
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“First-time buyers and young families especially are feeling the squeeze.”
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What’s more, prices have risen since last year. Calgary Real Estate Board statistics from the end of March reveal the aggregate average price was more than $639,000, up more than seven per cent year over year.