Real Estate

Locked: Household income and professions that can get into Vancouver and Toronto Housing Market

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  • Sep 13th, 2021 2:26 pm
[OP]
Newbie
Sep 2, 2021
42 posts
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Household income and professions that can get into Vancouver and Toronto Housing Market

The sad reality is that majority of residents in Vancouver and Toronto have come to accept the fact that they w likely will not be able to afford to get into the housing market. The current price of a detached house in the Vancouver is $1.8 million dollars and $1.75 million dollars in Toronto. Both cities have been reduced to the playground of the rich and famous.

Despite the sky high prices of real estate in both cities, they are both relatively cheaper compared to the housing market in other major cities such as Tokyo,London,New York,Paris,Los Angeles and Geneva.

It’s not just low blue-collar service workers who are being priced out of the hot real estate market.In a recent study done by VanCity the conclusion was by 2025, it found, only senior managers in business, construction and engineering will still make the affordability cut – doctors and lawyers would not.


The greatest intergenerational transfer of wealth in Canada’s history is set to take place over the next few decades.Approximately $1 trillion in personal wealth will be transferred from one generation to the next in Canada between 2016 and 2026, according to estimates, with roughly 70% of that in the form of financial assets. At this rate the only people that will be able to get into the housing market are those who are able to get a loan from the Bank of Mum and Dad and those who inherit assets from their parents or grandparents

For those of us who have always dreamed of moving to Vancouver or Toronto it all seems a pipe dream when you take into account even doctors and lawyers will eventually be priced out of the market.
Last edited by drenthe on Sep 9th, 2021 3:22 pm, edited 2 times in total.
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[OP]
Newbie
Sep 2, 2021
42 posts
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audit13 wrote: I thought Toronto was higher than New York: https://www.blogto.com/real-estate-toro ... w-york-la/
I guess recently Toronto,Vancouver and even Hamilton became higher than New York. I understand why people will like to acquire property in Vancouver and Toronto despite the increasing prices, but Hamilton on the other hand comes as a shock to me. The only reasonable explanation is Hamilton is still close to the GTA area.

https://www.cbc.ca/news/canada/hamilton ... -1.6034606
Sr. Member
Feb 19, 2017
672 posts
407 upvotes
So go be a senior manager in business, construction or engineering then. Currently, 2 professionals making 150K each can still afford to buy in these cities so it's not as drastic as you make it seem.
[OP]
Newbie
Sep 2, 2021
42 posts
26 upvotes
Walch1102 wrote: So go be a senior manager in business, construction or engineering then. Currently, 2 professionals making 150K each can still afford to buy in these cities so it's not as drastic as you make it seem.
How many 2 professionals out there can boast of the job security required to pay off the 20-25 year mortgage?That is a huge financial commitment.
Penalty Box
Jun 24, 2015
5296 posts
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what I heard is non professionals who make less money are buying houses. how? they are getting enough down payment to get a mortgage going knowing they will live in the house for 15-20 years and end up selling it and pocketing the profits so that is how they can afford mortage
Hi
Deal Addict
Jul 21, 2009
1209 posts
668 upvotes
Toronto
drenthe wrote: The sad reality is that majority of residents in Vancouver and Toronto have come to accept the fact that they w likely will not be able to afford to get into the housing market. The current price of a detached house in the Vancouver is $1.8 million dollars and $1.75 million dollars in Toronto. Both cities have been reduced to the playground of the rich and famous.

Despite the sky high prices of real estate in both cities, they are both relatively cheaper compared to the housing market in other major cities such as Tokyo,London,New York,Paris,Los Angeles and Geneva.

It’s not just low blue-collar service workers who are being priced out of the hot real estate market.In a recent study done by VanCity the conclusion was by 2025, it found, only senior managers in business, construction and engineering will still make the affordability cut – doctors and lawyers would not.


The greatest intergenerational transfer of wealth in Canada’s history is set to take place over the next few decades.Approximately $1 trillion in personal wealth will be transferred from one generation to the next in Canada between 2016 and 2026, according to estimates, with roughly 70% of that in the form of financial assets. At this rate the only people that will be able to get into the housing market are those who are able to get a loan from the Bank of Mum and Dad and those who inherit assets from their parents or grandparents

For those of us who have always dreamed of moving to Vancouver or Toronto it all seems a pipe dream when you take into account even doctors and lawyers will eventually be priced out of the market.
LOL you are out of touch with reality if you think you need to own 1.75 million dollar Toronto house to move here and enjoy Toronto life.
Deal Addict
Nov 24, 2004
4334 posts
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Toronto
Walch1102 wrote: So go be a senior manager in business, construction or engineering then. Currently, 2 professionals making 150K each can still afford to buy in these cities so it's not as drastic as you make it seem.
Depends on what you mean by "drastic" -- maybe the top 2-3% of GTA households have household income in that range.
[OP]
Newbie
Sep 2, 2021
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submarine wrote: LOL you are out of touch with reality if you think you need to own 1.75 million dollar Toronto house to move here and enjoy Toronto life.
Toronto and Vancouver are nice to visit on vacations, just like New York and Los Angeles. However, some people get carried away with the glitz and glamour and decide to make a permanent move knowing they will become life renters and never have any property to their name as long as they live there.

I feel bad when I encounter people that have lived in those cities for 15-20 years with nothing to show for all their hard work they put in except paying high annual rents. They could have gone to smaller cities like Calgary,Edmonton,Winnipeg or Ottawa and got properties to their names they could pass down to the next generation.

The housing situation in Vancouver and Toronto reminds me of a Jay Z verse in Empire State of Mind that paid homage to New York , " City is a pity, half of y'all won't make it". The big city is not for everyone, and some people don't realize it until it is too late.
Sr. Member
Jun 18, 2020
994 posts
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drenthe wrote: Toronto and Vancouver are nice to visit on vacations, just like New York and Los Angeles. However, some people get carried away with the glitz and glamour and decide to make a permanent move knowing they will become life renters and never have any property to their name as long as they live there.

I feel bad when I encounter people that have lived in those cities for 15-20 years with nothing to show for all their efforts except paying high monthly rents. They could have gone to smaller cities like Calgary,Edmonton,Winnipeg or Ottawa and got properties to their names they could pass down to the next generation.
While I understand your general point, the time frame is a poor choice. 20 yrs ago the avg price of a GTA home was prob 300-350k? So, anyone you encounter paying rent since then, yes, they unfortunately missed the boat-if they were renters and not owners in the early 2000s, that was an income issue, not affordability issue.

But most people coming in the early 2000s, houses were more affordable and they have made a ton. So they have a nice kitty to pass down.
Sr. Member
Jun 18, 2020
994 posts
868 upvotes
Walch1102 wrote: So go be a senior manager in business, construction or engineering then. Currently, 2 professionals making 150K each can still afford to buy in these cities so it's not as drastic as you make it seem.
Yup, two teachers making 200k HH can afford about 8-900k mortgage so if they have a small DP, they can get in the market (whether they should leverage that much is anther story...)

Obviously, housing in the GTA is expensive, but income can make the problem manageable. 2 bank middle managers out earn the teachers, never mind techbros, or professionals like lawyers, dr's etc.
Deal Fanatic
Dec 20, 2018
5515 posts
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you do know there's other types of housing other than a detached house right?

wife's brother and gf just bought condo downtown working in healthcare making around 80k each..they had around 100k saved and bought a 630k condo at yonge/dundas

wife's cousin and husband just bought a townhouse in markham for 950k... he's an optician at costco (or one of those types of stores) and she's a teller at a bank..they had around 150k saved

and i have new guys on my team who bought detached in newmarket for around 1M... he makes like 85k or so and his wife makes like 75k

these are the "low" earners as in below median income since they're relatively young (20s). median income is 100k in ontario for those working FT with a degree ...then you have the tech/finance/sales/trades/consulting/engineering/PM's etc who make 130k+ before bonuses and etc as well
Sr. Member
Feb 19, 2017
672 posts
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JHW wrote: Depends on what you mean by "drastic" -- maybe the top 2-3% of GTA households have household income in that range.
Let's be clear...I'm referring to 2 professionals pairing up and not have one become stay at home. Define professional how you will, but most make more than 100K after a few years (doctor, lawyer, engineer, accountant, b2b sales, nurse, teacher, pharmacist, optician, etc.).
[OP]
Newbie
Sep 2, 2021
42 posts
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StatsGuy wrote: you do know there's other types of housing other than a detached house right?

wife's brother and gf just bought condo downtown working in healthcare making around 80k each..they had around 100k saved and bought a 630k condo at yonge/dundas

wife's cousin and husband just bought a townhouse in markham for 950k... he's an optician at costco (or one of those types of stores) and she's a teller at a bank..they had around 150k saved

and i have new guys on my team who bought detached in newmarket for around 1M... he makes like 85k or so and his wife makes like 75k

these are the "low" earners as in below median income since they're relatively young (20s). median income is 100k in ontario for those working FT with a degree ...then you have the tech/finance/sales/trades/consulting/engineering/PM's etc who make 130k+ before bonuses and etc as well
Yes, I know there are other types of housing. A considerable number of home owners who own townhouses aspire to have a detached house to avoid hearing their neighbours baby screaming at night or hear the sound of them walking of the stairs through the thin walls that separate you.

For the news guys in your team that bought a 1M home in newmarket sounds to me like a dangerous gamble. What happens if one person in the household gets laid off? Can they still meet up with the mortgage payments after tax dedections,daycare costs, car payments and other household expenses? In your 20's and 30's you are supposed to start with a condo or townhouse and work your way towards a detached house after you have gained experience, and seniority in your career and built up a healthy nest egg to cover mortgage payment for a few years in the event you get laid off and have to find a new job.

One thing I have learnt in the few years working in the corporate world is that no one is safe. In the layoffs that took place in my previous company: the CFO,VP's and Directors were let go. You would think at the C-suite level you are sort of guaranteed some level of job security, but that is no longer the case.
[OP]
Newbie
Sep 2, 2021
42 posts
26 upvotes
GTA12345 wrote: While I understand your general point, the time frame is a poor choice. 20 yrs ago the avg price of a GTA home was prob 300-350k? So, anyone you encounter paying rent since then, yes, they unfortunately missed the boat-if they were renters and not owners in the early 2000s, that was an income issue, not affordability issue.

But most people coming in the early 2000s, houses were more affordable and they have made a ton. So they have a nice kitty to pass down.
Those that got in the marker early 2000's got lucky. I think the whole country envies those who got into the housing market in Toronto and Vancouver for 300-350k and are now sitting on a kitty worth over a million.
Deal Addict
Dec 27, 2007
3695 posts
1231 upvotes
Edmonton
drenthe wrote:

For those of us who have always dreamed of moving to Vancouver or Toronto it all seems a pipe dream when you take into account even doctors and lawyers will eventually be priced out of the market.
Who would want to live there when there are much much better places to live.
Always dreamed of living there? In a shitty city?
warming up the earth 1 gas fill-up at a time...
You only live once, get a v8
Deal Addict
Dec 27, 2007
3695 posts
1231 upvotes
Edmonton
drenthe wrote: . What happens if one person in the household gets laid off?

...

In your 20's and 30's you are supposed to start with a condo or townhouse and work your way towards a detached house after you have gained experience,.


....

You would think at the C-suite level you are sort of guaranteed some level of job security, but that is no longer the case.
If one person gets laid off. They get another job? Its not like they are unemployable...

And who in their smart mind wants to start off with a condo? You pay it off and then you still have the damn monthly payments. What a horrible strategy. You want a house? Buy a house first geez.

Who needs job security? So you can get lazy in your job?

I welcome getting laid off, it's actually the best part of the job. I have 7 more days before I get laid off.

Woooooot

Drinks are on me boys!
warming up the earth 1 gas fill-up at a time...
You only live once, get a v8
Deal Addict
Aug 31, 2017
4503 posts
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StatsGuy wrote: you do know there's other types of housing other than a detached house right?

wife's brother and gf just bought condo downtown working in healthcare making around 80k each..they had around 100k saved and bought a 630k condo at yonge/dundas

wife's cousin and husband just bought a townhouse in markham for 950k... he's an optician at costco (or one of those types of stores) and she's a teller at a bank..they had around 150k saved

and i have new guys on my team who bought detached in newmarket for around 1M... he makes like 85k or so and his wife makes like 75k

these are the "low" earners as in below median income since they're relatively young (20s). median income is 100k in ontario for those working FT with a degree ...then you have the tech/finance/sales/trades/consulting/engineering/PM's etc who make 130k+ before bonuses and etc as well
Do you have a source? I found this and $100K is not the median income.
https://www12.statcan.gc.ca/census-rece ... 24-eng.cfm
Highlights:
Men with an apprenticeship certificate in the skilled trades had strong earnings. With median earnings of $72,955 in 2015, they earned 7% more than men with a college diploma, 31% more than men with a high school diploma, and 11% less than men with a bachelor's degree.
Women with a bachelor's degree earned considerably more than women with college, high school or trades education. With median earnings of $68,342 in 2015, they earned around 40% more than women with a college diploma, around 60% more than women with a high school diploma, and about 80% more than women with an apprenticeship certificate.
Men with an apprenticeship certificate had faster growth in earnings from 2005 to 2015 than men at other levels of education. Women with a bachelor's degree saw faster earnings growth than women at other educational levels.
Among the provinces, men and women residing in Alberta had the highest earnings at every level of education.
Women with a high school diploma in Nunavut earned more than women with a bachelor's degree in every province and Yukon.
So I’m going to call BS on your post. It only adds to the issues we are experiencing.
Edited because I messed up with my second link
Last edited by MyNameWasTaken on Sep 9th, 2021 9:14 pm, edited 4 times in total.
Member
Mar 26, 2013
415 posts
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Toronto
tmkf_patryk wrote: Who would want to live there when there are much much better places to live.
Always dreamed of living there? In a shitty city?
The two best cities in Canada. Where is better?
Deal Addict
Nov 24, 2004
4334 posts
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Toronto
Walch1102 wrote: Let's be clear...I'm referring to 2 professionals pairing up and not have one become stay at home. Define professional how you will, but most make more than 100K after a few years (doctor, lawyer, engineer, accountant, b2b sales, nurse, teacher, pharmacist, optician, etc.).
Right, I was referring to your point about a household of two $150k earners "can still afford to buy". Very few households have that kind of income. In Ontario as a whole it's maybe two or three of every 100 households, in the GTA it's likely somewhat more but still not a huge number.

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