Toronto's housing market is a crisis in affordability: what it takes to afford a home in Toronto

Housing affordability has emerged as a significant concern across Canada, with escalating home prices creating challenging conditions for prospective buyers. This issue is particularly pronounced in Toronto, where the average home price has reached $1,074,425, according to the latest data from the Toronto Regional Real Estate Board (TRREB) for August 2024. While industry professionals analyze various metrics such as sales figures and interest rates, the primary question for the average buyer remains: “What kind of home can I afford?”

How the income to afford a home was calculated

The average home price is from the market watch report released by the Toronto Regional Real Estate Board (TRREB). The total mortgage amount is the average home price less a 20% down payment. For the calculation of a mortgage payment a 25-year armotization period was used with a 5-year fixed mortgage rate of 5.00%. The 28/36 rule was then applied to calculate what income would be needed for the monthly mortgage payment to be considered affordable.

Example: How much income would you need to purchase the average home in Toronto?

The average home price in Toronto across all property types is $1,074,425. With a 20% down payment or $214,885 applied to this average home price you would need to make mortgage payments on a $859,540 mortgage. With a 5.00% 5-year fixed mortgage rate over a 25-year amortization period, your monthly mortgage payment would be $4,999.

You can also use a mortgage affordability calculator to see how much house you can afford.

Income needed to afford home prices in the Greater Toronto Area (GTA)

Burlington

• Burlington average home price: $1,178,429
• Household Income Needed: $234,987

Halton Hill

• Halton Hill average home price: $979,200
• Household Income Needed: $195,260

Milton

• Milton average home price: $1,000,100
• Household Income Needed: $199,427

Oakville

• Oakville average home price: $1,200,000
• Household Income Needed: $239,289

Brampton

• Brampton average home price: $984,544
• Household Income Needed: $196,325

Caledon

• Caledon average home price: $1,221,819
• Household Income Needed: $243,640

Missisauga

• Missisauga average home price: $1,044,543
• Household Income Needed: $208,290

Aurora

• Aurora average home price: $1,360,986
• Household Income Needed: $271,391

East Gwillimbury

• East Gwillimbury average home price: $1,269,585
• Household Income Needed: $253,165

Georgina

To afford a home in Toronto you need to make significantly more than the average household income. Here you can find the most affordable cities in Ontario to purchase a home.

• Georgina average home price: $920,394
• Household Income Needed: $183,533

King

• King average home price: $2,211,674
• Household Income Needed: $441,024

Markham

• Markham average home price: $1,260,792
• Household Income Needed: $251,411

Newmarket

• Newmarket average home price: $1,047,937
• Household Income Needed: $208,966

Richmond Hill

• Richmond Hill average home price: $1,434,225
• Household Income Needed: $285,995

Vaughan

• Vaughan average home price: $1,240,158
• Household Income Needed: $247,297

Stouffville

• Stouffville average home price: $1,574,628
• Household Income Needed: $313,993

Ajax

• Ajax average home price: $939,714
• Household Income Needed: $187,386

Brock

• Brock average home price: $749,240
• Household Income Needed: $149,404

Clarington

• Clarington average home price: $836,354
• Household Income Needed: $166,775

Oshawa

• Oshawa average home price: $780,900
• Household Income Needed: $155,717

Pickering

• Pickering average home price: $981,212
• Household Income Needed: $195,661

Scugog

• Scugog average home price: $1,029,883
• Household Income Needed: $205,366

Uxbridge

• Uxbridge average home price: $1,291,179
• Household Income Needed: $257,471

Whitby

• Whitby average home price: $966,783
• Household Income Needed: $192,784

Orangeville

• Orangeville average home price: $836,896
• Household Income Needed: $166,883

Bradford

• Bradford average home price: $1,026,242
• Household Income Needed: $204,640

Essa

• Essa average home price: $781,126
• Household Income Needed: $155,762

Innisfil

• Innisfil average home price: $930,056
• Household Income Needed: $185,460

New Tecumseth

• New Tecumseth average home price: $831,247
• Household Income Needed: $165,757

How does Toronto affordability compare to the rest of Canada? check out how much income to afford a home in Canada. This shows a breakdown of how much income it takes to afford a home in provinces and major cities around Canada.

Source: TREBB, CREA