The average income required to buy a new home in Ottawa decreased in January, as home prices and mortgage rates softened to start the new year, according to a new report.
Statistics released by Ratehub.ca shows homebuyers needed to earn an income of $128,840 to buy the average priced home in Ottawa last month. That's down from $133,660 a year income in December and $138,260 last July.
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Ratehub.ca says the average home price in Ottawa dropped from $623,900 in December to $621,600 in January, while the mortgage rates decreased from 6.16 per cent in December to 5.71 per cent in January.
"According to the numbers, softening mortgage rates have effectively pulled down the mortgage stress test, which tacks 2 per cent onto borrowers' contract rates," Ratehub.ca says in its report.
The income required to buy a home decreased in all 13 Canadian cities that Ratehub.ca looked at.
In Vancouver, homebuyers need an average income of $227,780 to buy the average priced home, down from $237,400 in December. Homebuyers need an average income of $210,300 to buy a home in Toronto, down from $218,100 in December.
Fredericton, New Brunswick has the lowest income requirements to purchase an average priced home, at $67,380.
Ratehub.ca says its data is based on a mortgage with a 20 per cent down payment, 25-year amortization and $4,000 in annual property taxes.
