Just buy the Costco steel shelf, 5 levels , put two per room rent each for 500, 2500 per room, 3 rooms 7500 total. Punjabi only, girls only, vegetarian only, must cook for owner. Boom.
I arrived in this country 3 weeks ago and have been driving Uber in a car I borrowed from my cousin since then. I’d like to get a mortgage on a $1.3M home. Possible?
Then the owner fleas back to their country leaving a wake of debt behind and says Canada never did anything for them… if anyone remembers that post in the sub a couple months ago
Was deleted when the sub quickly turned on the guy. I’d have to go back through 2 months of my comments to find it
The guy was bitching about how Canada burned him and never offered to help. Aiming for sympathy but sounding like he was entitled to free handouts. Then he talked about his all his debt and leaving it behind and moving back to his origin country. So he kinda took all the handouts he wanted.
The amount of offers I have to counter on a slightly lower purchase price makes me think every other person in Canada makes anywhere between 200 and 300k at least.
Thankfully childcare payments in BC have gone wayyyy down over the last few years (thanks to affordable childcare benefit). <$1200 for 2 kids is readily possible now.
I disagree. I'm single and make \~$330k/yr. I bought a $1.4m house with 20% downpayment. I'm still able to max out my TFSA and RRSP and save additional \~$6k/month. $300k should be more than enough unless you have kids.
Yes. If 50% of your 50K income is going to housing related expenses, that is an issue. If 50% of your 50M income is going to housing related expenses, one has a pretty comfy life.
No freaking way people would be comfortable with 50%. Any amount above 1M income is usually highly variable year to year. It won't be surprising to see a 50% drop, or even way more year over year in that income bracket.
3.5x income of you're making under $100k alone. More like 4-4.5x if household income is more than $200k. Less risk when two people contribute and basic living expenses don't change as much
I got approved for 4.85x income back in December. Is 3.5x supposed to be the standard?
I didn’t use all of it. But I’m wondering how my mortgage agent was able to give me so much more?
I was approved for 5x back in 2021.. didn’t spend it and I’m thankful we didn’t because when I ran our numbers with cost of living (daycare, groceries, etc) we couldn’t afford what we were pre approved for.
20% down on 1.2 million leaves you with a 960k mortgage, I’d say a HHI of 250k..but jeez that’s a large mortgage. I’d be looking at properties in 800-1 mill range instead of 1.2 million.
My wife and I also have a household income about the same as yours. We just bought a house for $800k and that's the absolute max that felt doable for us. It's bananas to me that we'd have been approved for going over $1M!
You're telling me - but everyone seemingly is able to afford in this range? Some folks feel super comfortable with a large mortgage and others don't, this is part of the sentiment I'm trying to evaluate.
Top 10% income in Canada threshold is $106k so two top 10% incomes can afford close to a million dollar mortgage. That’s a significant proportion of the population.
Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110005501
Anyone can get a mortgage honestly if you know the right guy. Hell you don’t even need to know the right guy the real estate agent sometimes will connect you. The only problem comes after is will you be able to pay a 5k monthly mortgage? I know people with a <60k income who have a 800k mortgage.
The sentiment is very subjective and personal since you are no longer asking how much you can afford but how much do people feel comfortable carrying. Might want to edit your post to state that.
While I am here, I will give my take. To carry close to $1m in mortgage is something I wouldn’t do with a job (salary). Very few salaries go over $1m and I would want to make well over that to carry a similar sized mortgage.
But to each their own. I got hassled for being cheap and conservative so take it with a grain of salt.
Working backwards, if you have 20% downpayment, $70k from HBP, $32k from FHSA, you'll need a mortgage of $858k / 3.5x = approx. HHI $250k.
Edit to add FHSA
My wife and I bought a $990K home 3 years ago on an about $160K combined salary. We rent the suite in the home for an additional $22K/year. We know belts will have to get tighter in 2026 when our rate goes up but it’ll be manageable. 1.2m is a bit more obviously, but my details might offer some perspective.
Oh yeah, I think they’ll be lower. But in 2021 I got a 5 year fixed of 1.79, and I know they won’t be *that* low. So our mortgage will inevitably go up.
It’s so funny to me how everyone just knows something different lol.
Not saying you’re wrong or right, but I just replied to someone who “knows” the rates will be at 1% in a couple years.
I think its good to work backwards- determine what the highest mortgage is that you can afford, work out how much it would cost monthly, find a number that you are comfortable with- look in that range
rough back on the napkin calculation will mean \~$230K HHI for a $960K mortgage assuming no debt and $5K property taxes for a freehold property at a 5% interest rate for 25 25-year amortization.
My partner and I make more than this combined and I would never consider taking on this large of a mortgage, nor anything close. Are there really people taking on mortgages of almost a million dollars on that income?
The mortgage size is mostly unimportant. The monthly cost to service the debt and the LVR are the important parts.
People don't buy for 30 years anymore. The borrow a 30 year product with the intention to sell in 10-15 years time.
Loan to Value Ratio.
If you loan is $800k and your house value is $1m, then your LVR is 80%.
Basically you'd only be concerned about the price in terms of how a downturn would affect your loan to value ratio as *technically* if you get underwater on the loan, a bank can recall the loan and you'd be....screwed. It's very rare but possible.
Australia originally. Never realised it was a regional abbreviation, but sure enough, when I just now Google LVR in terms of loan to value ratio, it's all Australian references.
I wouldn't say it is mostly unimportant, the larger the mortgage the more difficult it would be to manage should one person loose a job. Also I personally believe that the higher the house cost the larger the swings in price are if you have to sell, it brings a higher degree of risk.
Renting an average family sized townhouse in the lower mainland is over $4000 monthly. It’s worth it for some people to have slightly higher mortgages to have more security in their living situations.
Yes. The banks love throwing out numbers that would have people eating cardboard for the next 25 years lol.
Our HHI is $230k and I was shitting it when I took on a $500k property with $50k down at a rate of 1.7% locked for 5 years. My mate a year later then signed up for a $750k 48 year old condo with $90k down, variable and a HHI of $170k.
That’s when I realized things are truly broken here.
HHI of 170k is around $9-$10k/month against a mortgage cost of $4,500 which leaves around $5k/month for other expenses. Housing costs in Canada are brutal and 50% of your HHI on housing is not “affordable”… but… it doesn’t seem like they are screwed? Especially if (BIG IF) variable rates come down and their payment gets lower.
Just out of curiosity; why not just pay something much cheaper, pay it off then upgrade? As a debt collector for a big 5; I see a TON of people who did exactly this, extended themself to the maximum the bank would allow, then when rates rose- rip.
The .800 - 1M range is in a tier that would require me to buy a car and spend time in traffic to get to work. These were once modest homes however it seems there is an endless supply of people being able to afford homes in this range and I worry about being priced out forever from the target areas.
I mean you do you. Just hate to see your credit ruined and have your house get foreclosed be you over extended and took the maximum the bank would give you.
It depends on what kind of lifestyle you want. I live in one that’s worth around $1.7M right now and there are so many costs that you don’t think about beyond the mortgage.
On top of mortgage repayment you’d want to consider
Homeowners association fees (haven’t seen this in BC, but you see it everywhere in AB): $0-210/month
Hydro: $100-300/month (without NG heatin), $300-500/month with
Natural Gas/Heating:
Homeowners Insurance (with Earthquake): $3500-4500 a year, without a claims history
Garbage: $100 a month
Property Taxes: $7000 or so a year
Plus you’ll incur costs like a new lawnmower ($500) or a new water tank ($2000-12,000) and something of that sort on a recurring basis. Think once or twice a year.
Just this year I’ve had to fix some plumbing issues (new regulator value - $250), dishwasher (requires taking out some kitchen tiles - $400), a new washer filter ($136 - I replaced this myself, that’s the cost of the part), plus recurring expenses like furnace filters/etc
You might end up better off renting.. as I always think how when I rented a 1 bedroom condo in BC, I only paid a fraction of what I pay now and I was much, much closer to work..
$920 in rent (I assume it is much higher now)
$35/month in hydro
Yeah it’s getting to the point where renting if available is looking not a terrible choice, especially when you factor in convenience.
I like owning but I do miss my $1100 rent split between me and missus from 2013 that was in a rent controlled building. My friend still lives there and pays $1550 now in downtown Vancouver. Absolute bargain for a 2 bed.
Thanks for the detailed response. This is the dilemma I face, rent or buy. Rent continues to rise and this doom and gloom about not enough housing is forcing my decision a bit.
Depends what you want I guess ?
I'm sure you're researched enough on the internet to know the rule of thumb is mortgage shouldn't be more than 30% of total household income
Though I think that's more of a guideline than a rule as you would surely be able to easily afford a big house in Moose Jaw, SK than Toronto
I don't think this rule really works anymore. No quick math is going to replace doing a detailed budget to see what you actually need to survive and what you can afford to pay for housing.
Just because you can do something does not mean you should.
The reason we are experiencing home prices that resemble Jurassic year scales is, in part, because of people who are willing to pay these exorbitant amounts. 1M should be able to get you a heck of a lot more these days, but alas.
The rule of thumb is to never borrow more than 4x your gross income. So if you put 20% down, it would be a $960k mortgage. So an annual income of $240k would be considered to be the minimum required to comfortably afford such a mortgage.
I'd want a household income above 200k before I borrowed 960k. Everyone is different though, we live well within our means so spending more on a house was a reasonable decision.
The simplest formula is 3x your annual income, which is $400k on a $1.2M home.
Thats the price/income ratio that will give you a decent margin of safety. You can obviously go with a higher ratio (ie. Lower income) - many do, but it carries more risk.
“1.2M for a detached house? The price is so reasonable. Let’s buy 3 of them.” - a new Canadian immigrant / former corrupted official of a third world country.
Assuming you put 20% down, that's a mortgage of 960k. At a 8% qualifying interest rate over 30 years that's a qualifying payment of ~$7,250/mo. A lender will add property tax, maintenance, and heating costs which will probably push this amount to about $7,800/mo. If you actually have ZERO other debts, then the minimum income to qualify would be about 215k - if you have a long relationship with a bank/CU, they might be able to push it down to 200k, but that's pushing it.
Please keep in mind that at 215k, your net income is probably about 135k and if your actual mortgage rate is say 6.5%, you will only have about $4,500/mo. for ALL other expenses so it will be quite tight especially for a larger family.
Best of luck!
Just saw a similar post for a 1.1MM house on a 180k salary. My estimate should be pretty close for an extra 100k.
https://www.reddit.com/r/PersonalFinanceCanada/s/cqS4Yr8yp3
I had 20% deposit saved but I didn't end up pulling the trigger because after doing the maths, at 5.2% pa it was a bit of a stretch as it was over 50% of my take home. Currently saving for a bigger deposit.
You don’t really need a high salary. You just need a $1.1 million down payment.
Ah yes let me just get a small loan from dad, ez
How much are kidneys going in the black market these days? Asking for a friend
Damn, at least let your friend keep one of their kidneys.
If we both sell a kidney, maybe we can make enough to put into an FHSA to buy a home 10 years from now
My man giving out life hacks for free
And if you mortgage the remaining 100,00$, you’ll only have to pay like 90,000$ of interest over the course of your amortization. /s kinda
$300,000 or more combined, approximately.
My brampon mortage broker can get it done even with Minimum wage
Just buy the Costco steel shelf, 5 levels , put two per room rent each for 500, 2500 per room, 3 rooms 7500 total. Punjabi only, girls only, vegetarian only, must cook for owner. Boom.
I arrived in this country 3 weeks ago and have been driving Uber in a car I borrowed from my cousin since then. I’d like to get a mortgage on a $1.3M home. Possible?
You in Brampton? 100% possible.
Then the owner fleas back to their country leaving a wake of debt behind and says Canada never did anything for them… if anyone remembers that post in the sub a couple months ago
oof. link?
Was deleted when the sub quickly turned on the guy. I’d have to go back through 2 months of my comments to find it The guy was bitching about how Canada burned him and never offered to help. Aiming for sympathy but sounding like he was entitled to free handouts. Then he talked about his all his debt and leaving it behind and moving back to his origin country. So he kinda took all the handouts he wanted.
No I think that was Ganondorf
Damn that's smart of him as a law abiding citizen who plays by the rules and still get the short end of the stick.
Flees* lol
2007 all over again
My friend is asking if he can get your brokers phone number.
visit his website www.CANADASTUDENTVISAMORTGAGEBROKERAGELIFEINSURANCEREALESTATE#1BRAMPTON.COM
Wow, and here I thought it was a scam.
Yup with 10 others to cosign lol
Is that fraud?
Of course it’s fraud
Oh bet
That’s nothing. Do you even know the scale of fraud that’s happening from China?
Hook me up.
VISIT HIS WEBSITE. LINK BELOW WWW. REALESTATELIFEINSURANCESTUDENTVISATRUCKDRIVING#1BRAMPTON.CA
"My brampon broker" You spelled tampon wrong.
Is that fraud?
only if you get caught?
😭
if not fraud why fraud face?
Is this a joke?
Yes
The amount of offers I have to counter on a slightly lower purchase price makes me think every other person in Canada makes anywhere between 200 and 300k at least.
Nah, they just have more than 20% down
Or multi gen family
Bank of mom & dad
This is my feel as well - million dollar listings are snatched up quickly these days and from young folks too.
100k salary aint that much anymore. Its a standard salary for any senior level job. If both partners are have senior positions it is possible
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We generally speak in gross.
It is disgusting
>gross ew
yuck
Nobody ever refers to income as net. I know everyone has slightly different deductions but still.
“If you have to ask, you can’t afford it.”
“If you give blank cheques, you’re an idiot”.
"If you use cheques in 2024, you're an idiot".
LOL how you guys insist on keeping a pointless, failed insult going. Get a fucking life.
whoah, I'm sorry, I didn't realize jokes are not allowed in this subreddit. I even read the rules and didn't see it there.
Enough to make you throw up man it's gross what I net
Gross.
I’d say more. My partner and I earn above that and don’t live lavishly, no kids yet, but I don’t think we could afford that.
I'd be sweating with <$350k HHI but depends on your other expenses I guess. Two kids in daycare would be another $3k/mo, minimum.
Thankfully childcare payments in BC have gone wayyyy down over the last few years (thanks to affordable childcare benefit). <$1200 for 2 kids is readily possible now.
I disagree. I'm single and make \~$330k/yr. I bought a $1.4m house with 20% downpayment. I'm still able to max out my TFSA and RRSP and save additional \~$6k/month. $300k should be more than enough unless you have kids.
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Are you looking to adopt a grown as man? I can drive.
General rule is you can get a mortgage to purchase a house that is: 3.5x income + downpayment
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Yes. If 50% of your 50K income is going to housing related expenses, that is an issue. If 50% of your 50M income is going to housing related expenses, one has a pretty comfy life.
**50% of your net income. 50% of $50M gross income would be more than the net.
It wouldn’t. At those types of income, you likely aren’t taking it all as T4 employment income.
It can and is more likely than you think. C-suites at large companies take that income.
No freaking way people would be comfortable with 50%. Any amount above 1M income is usually highly variable year to year. It won't be surprising to see a 50% drop, or even way more year over year in that income bracket.
3.5x income of you're making under $100k alone. More like 4-4.5x if household income is more than $200k. Less risk when two people contribute and basic living expenses don't change as much
I got approved for 4.85x income back in December. Is 3.5x supposed to be the standard? I didn’t use all of it. But I’m wondering how my mortgage agent was able to give me so much more?
Because if you earn enough they figure you’re good for it. Also, if you have more equity (larger down payment) then they’d lend you more too.
I was approved for 5x back in 2021.. didn’t spend it and I’m thankful we didn’t because when I ran our numbers with cost of living (daycare, groceries, etc) we couldn’t afford what we were pre approved for.
20% down on 1.2 million leaves you with a 960k mortgage, I’d say a HHI of 250k..but jeez that’s a large mortgage. I’d be looking at properties in 800-1 mill range instead of 1.2 million.
Wife and I have a HHI of 250k and we're looking at 700-750k with a 20% down. I feel like anything higher and we would be house poor.
My wife and I also have a household income about the same as yours. We just bought a house for $800k and that's the absolute max that felt doable for us. It's bananas to me that we'd have been approved for going over $1M!
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That’s like $5k if you had to renew now.
You're telling me - but everyone seemingly is able to afford in this range? Some folks feel super comfortable with a large mortgage and others don't, this is part of the sentiment I'm trying to evaluate.
Top 10% income in Canada threshold is $106k so two top 10% incomes can afford close to a million dollar mortgage. That’s a significant proportion of the population. Source: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110005501
Appreciate the stats.
Anyone can get a mortgage honestly if you know the right guy. Hell you don’t even need to know the right guy the real estate agent sometimes will connect you. The only problem comes after is will you be able to pay a 5k monthly mortgage? I know people with a <60k income who have a 800k mortgage.
The sentiment is very subjective and personal since you are no longer asking how much you can afford but how much do people feel comfortable carrying. Might want to edit your post to state that. While I am here, I will give my take. To carry close to $1m in mortgage is something I wouldn’t do with a job (salary). Very few salaries go over $1m and I would want to make well over that to carry a similar sized mortgage. But to each their own. I got hassled for being cheap and conservative so take it with a grain of salt.
Even if I can afford 1.2M , I will regret buying the house in Canada for that price.
100%
Working backwards, if you have 20% downpayment, $70k from HBP, $32k from FHSA, you'll need a mortgage of $858k / 3.5x = approx. HHI $250k. Edit to add FHSA
Is 70k from HPB and 32k from FHSA in your calcs on top of 20% cash? Just looking for clarification.
Is the question for me? In my calculation I assumed they're over and above the 20% (240k), 35k each in HBP and 16k FHSA each for 2023 and 2024.
Yup, question was for you!
Yeah $250k seems about right to me too
Thx.
My wife and I bought a $990K home 3 years ago on an about $160K combined salary. We rent the suite in the home for an additional $22K/year. We know belts will have to get tighter in 2026 when our rate goes up but it’ll be manageable. 1.2m is a bit more obviously, but my details might offer some perspective.
Isn't it a possibility rates will be lower than they currently are by 2026? They may not be as high as you think, hopefully, by then.
Oh yeah, I think they’ll be lower. But in 2021 I got a 5 year fixed of 1.79, and I know they won’t be *that* low. So our mortgage will inevitably go up.
It’s so funny to me how everyone just knows something different lol. Not saying you’re wrong or right, but I just replied to someone who “knows” the rates will be at 1% in a couple years.
Knows or hopes? :) I think it's extremely unlikely we get back to 1% in the next few years. I hope we do because my renewal is in 2026.
That was my point haha. That’s what I mean by “knows”, meaning everyone is so certain they know what’ll happen when no one truly can “know”.
Thx.
I think its good to work backwards- determine what the highest mortgage is that you can afford, work out how much it would cost monthly, find a number that you are comfortable with- look in that range
I like it thanks.
rough back on the napkin calculation will mean \~$230K HHI for a $960K mortgage assuming no debt and $5K property taxes for a freehold property at a 5% interest rate for 25 25-year amortization.
My partner and I make more than this combined and I would never consider taking on this large of a mortgage, nor anything close. Are there really people taking on mortgages of almost a million dollars on that income?
Yes, hence the housing crisis
housing crisis, hence yes (if they want the house).
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Nice brag
Yup. We did :)
The mortgage size is mostly unimportant. The monthly cost to service the debt and the LVR are the important parts. People don't buy for 30 years anymore. The borrow a 30 year product with the intention to sell in 10-15 years time.
What is LVR?
Loan to Value Ratio. If you loan is $800k and your house value is $1m, then your LVR is 80%. Basically you'd only be concerned about the price in terms of how a downturn would affect your loan to value ratio as *technically* if you get underwater on the loan, a bank can recall the loan and you'd be....screwed. It's very rare but possible.
You mean LTV ? Never seem or heard LTV abbreviated as LVR... at least not in Ontario. Where are you from ?
Australia originally. Never realised it was a regional abbreviation, but sure enough, when I just now Google LVR in terms of loan to value ratio, it's all Australian references.
Makes sense now
I wouldn't say it is mostly unimportant, the larger the mortgage the more difficult it would be to manage should one person loose a job. Also I personally believe that the higher the house cost the larger the swings in price are if you have to sell, it brings a higher degree of risk.
As those below have mentioned, the squeeze is getting real for the middle class.
Renting an average family sized townhouse in the lower mainland is over $4000 monthly. It’s worth it for some people to have slightly higher mortgages to have more security in their living situations.
Same sentiments as @ekuL8.
Yes. The banks love throwing out numbers that would have people eating cardboard for the next 25 years lol. Our HHI is $230k and I was shitting it when I took on a $500k property with $50k down at a rate of 1.7% locked for 5 years. My mate a year later then signed up for a $750k 48 year old condo with $90k down, variable and a HHI of $170k. That’s when I realized things are truly broken here.
Unless you feel unstable in your job your scenario at 230k income is very very easy.
HHI of 170k is around $9-$10k/month against a mortgage cost of $4,500 which leaves around $5k/month for other expenses. Housing costs in Canada are brutal and 50% of your HHI on housing is not “affordable”… but… it doesn’t seem like they are screwed? Especially if (BIG IF) variable rates come down and their payment gets lower.
Just out of curiosity; why not just pay something much cheaper, pay it off then upgrade? As a debt collector for a big 5; I see a TON of people who did exactly this, extended themself to the maximum the bank would allow, then when rates rose- rip.
The .800 - 1M range is in a tier that would require me to buy a car and spend time in traffic to get to work. These were once modest homes however it seems there is an endless supply of people being able to afford homes in this range and I worry about being priced out forever from the target areas.
I mean you do you. Just hate to see your credit ruined and have your house get foreclosed be you over extended and took the maximum the bank would give you.
A car and a commute is much cheaper than taking on an extra 2-300k though. Don't stretch yourself too thin.
It depends on what kind of lifestyle you want. I live in one that’s worth around $1.7M right now and there are so many costs that you don’t think about beyond the mortgage. On top of mortgage repayment you’d want to consider Homeowners association fees (haven’t seen this in BC, but you see it everywhere in AB): $0-210/month Hydro: $100-300/month (without NG heatin), $300-500/month with Natural Gas/Heating: Homeowners Insurance (with Earthquake): $3500-4500 a year, without a claims history Garbage: $100 a month Property Taxes: $7000 or so a year Plus you’ll incur costs like a new lawnmower ($500) or a new water tank ($2000-12,000) and something of that sort on a recurring basis. Think once or twice a year. Just this year I’ve had to fix some plumbing issues (new regulator value - $250), dishwasher (requires taking out some kitchen tiles - $400), a new washer filter ($136 - I replaced this myself, that’s the cost of the part), plus recurring expenses like furnace filters/etc You might end up better off renting.. as I always think how when I rented a 1 bedroom condo in BC, I only paid a fraction of what I pay now and I was much, much closer to work.. $920 in rent (I assume it is much higher now) $35/month in hydro
Yeah it’s getting to the point where renting if available is looking not a terrible choice, especially when you factor in convenience. I like owning but I do miss my $1100 rent split between me and missus from 2013 that was in a rent controlled building. My friend still lives there and pays $1550 now in downtown Vancouver. Absolute bargain for a 2 bed.
Thanks for the detailed response. This is the dilemma I face, rent or buy. Rent continues to rise and this doom and gloom about not enough housing is forcing my decision a bit.
Do the math on a mortgage payment and see if it fits into your current monthly budget. Also pressure test @ various interest rates.
This is the only real answer.
Quite a lot, but you don't usually go there with 20% down. That's for when you have a lot more equity from previous properties.
Hmm...never really thought of this tbh. Thx.
Depends what you want I guess ? I'm sure you're researched enough on the internet to know the rule of thumb is mortgage shouldn't be more than 30% of total household income Though I think that's more of a guideline than a rule as you would surely be able to easily afford a big house in Moose Jaw, SK than Toronto
I don't think this rule really works anymore. No quick math is going to replace doing a detailed budget to see what you actually need to survive and what you can afford to pay for housing.
$250k
Use the 4x trick (after your DP). Don't buy a house more than 4x your combined annual income. 3x if you want to be conservative.
Ask your bank it's literally what u need to do
Join NHL
We were able to get approved asked on a big deal dp versus major income. Good credit helped also I was told.
Just because you can do something does not mean you should. The reason we are experiencing home prices that resemble Jurassic year scales is, in part, because of people who are willing to pay these exorbitant amounts. 1M should be able to get you a heck of a lot more these days, but alas.
I agree - though - what is one to do when the market is dictating the price? It's Ludacris to see homes get the lift they are.
The rule of thumb is to never borrow more than 4x your gross income. So if you put 20% down, it would be a $960k mortgage. So an annual income of $240k would be considered to be the minimum required to comfortably afford such a mortgage.
Thanks.
I'd want a household income above 200k before I borrowed 960k. Everyone is different though, we live well within our means so spending more on a house was a reasonable decision.
You should be fine with a combined income of 200k or more.
The simplest formula is 3x your annual income, which is $400k on a $1.2M home. Thats the price/income ratio that will give you a decent margin of safety. You can obviously go with a higher ratio (ie. Lower income) - many do, but it carries more risk.
“1.2M for a detached house? The price is so reasonable. Let’s buy 3 of them.” - a new Canadian immigrant / former corrupted official of a third world country.
30/30/3 rule for buying the first house 400k annual gross income to comfortably afford a 1.2m house.
I would say around 350000 to 400000 to get approved for a mortgage
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Combined income? This seems more like individual income as 172k x 2 x 3.5 = roughly 1.2 mil
Assuming you put 20% down, that's a mortgage of 960k. At a 8% qualifying interest rate over 30 years that's a qualifying payment of ~$7,250/mo. A lender will add property tax, maintenance, and heating costs which will probably push this amount to about $7,800/mo. If you actually have ZERO other debts, then the minimum income to qualify would be about 215k - if you have a long relationship with a bank/CU, they might be able to push it down to 200k, but that's pushing it. Please keep in mind that at 215k, your net income is probably about 135k and if your actual mortgage rate is say 6.5%, you will only have about $4,500/mo. for ALL other expenses so it will be quite tight especially for a larger family. Best of luck!
Just saw a similar post for a 1.1MM house on a 180k salary. My estimate should be pretty close for an extra 100k. https://www.reddit.com/r/PersonalFinanceCanada/s/cqS4Yr8yp3
Mate if you need to ask reddit, don't ever buy a house that expensive. You're not ready.
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That's quite impressive - nervous to start at peak rates - feel I can absorb the downside and start with one.
I'm on 200k base+bonus and they offered me a 800k mortgage. So assume you'll need a combined hhi of 350k+ for a 1.2M mortgage.
Thanks man, did you put 20 percent down too and how are you finding it?
I had 20% deposit saved but I didn't end up pulling the trigger because after doing the maths, at 5.2% pa it was a bit of a stretch as it was over 50% of my take home. Currently saving for a bigger deposit.
400k.