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Your Household Income vs Mortgage Size - Page 3 - Beyond.ca - Car Forums

View Poll Results: Ratio (X) of HH Income vs Initial Mortgage (for primary residence)

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  • x < 1

    8 7.08%
  • 1 <= x < 2

    16 14.16%
  • 2 <= x < 3

    44 38.94%
  • 3 <= x < 4

    29 25.66%
  • 4 <= x < 5

    6 5.31%
  • x >= 5

    10 8.85%
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Thread: Your Household Income vs Mortgage Size

  1. #41
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    I’d say the average household would not be bringing in $130k... if one partner is currently unemployed or underemployed, or is having or just had a child... but these people are probably also pausing their home searches till both partners are back to full earning capacity, so would not be in the sample used in figuring out income to mortgage ratios on a first time home buyer

  2. #42
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    Our mortgage in Calgary was around 2x our household gross income back in 2006. Since then, the higher income earner has quit her paying job for a 24/7 no pay job. So at least in our household, gross income has at least halved :P

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    We were approved for ~5.5X, which seemed crazy. We ended up doing 3X, which I'm so glad we did as my wife is now on mat leave with the new born. At 3X it's still quite manageable, couldn't imagine >5X.. and it's not just the mortgage but everything else that comes with it like higher property tax, higher utilities (probably a bigger house), etc..

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    Yup, house ownership ain't cheap, not to mention the additional interest. Alot of people would say "yeah it's only 3% interest though" but then the extra 250k mortgage they take on is more than they have in their bank.

  5. #45
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    Quote Originally Posted by rx7boi View Post
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    Yup, house ownership ain't cheap, not to mention the additional interest. Alot of people would say "yeah it's only 3% interest though" but then the extra 250k mortgage they take on is more than they have in their bank.
    they still say the average appreciation in RE price is 3% though... so free money

  6. #46
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    2.5x with just my income. 1.85x with mine and my wives.

    Levering up to 5x is crazy... When I think of all the shit we buy outside of the mortgage 1.85x feels like a lot of leverage.

    Wife goes on mat leave in August the second income going away makes things harder.

  7. #47
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    Quote Originally Posted by Mitsu3000gt View Post
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    But we are in a downturn....4 years ago doesn't really matter IMO. I still don't believe the average household in 2018/19 is bringing in ~$130K. If there is data that shows that I would be interested to see it and gladly change my view.
    I would assume another census run will happen if Libs are still in power after this election but that's a whole another thread.

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    Quote Originally Posted by Xtrema View Post
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    I would assume another census run will happen if Libs are still in power after this election but that's a whole another thread.
    Wouldn't the government have this general info readily available from tax returns? I genuinely don't know, I am curious. I've got to believe they keep that data somewhere, but maybe not.

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    Quote Originally Posted by Mitsu3000gt View Post
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    Wouldn't the government have this general info readily available from tax returns? I genuinely don't know, I am curious. I've got to believe they keep that data somewhere, but maybe not.
    I think what CRA collected is private but what Census collected is public.

  10. #50
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    Quote Originally Posted by lasimmon View Post
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    We thought about this, but the thought of buying a home and STILL having to deal with people renting and sharing walls with us was just a total turn off.
    It's definitely not for everyone. It's a compromise in the name of responsibly stewarding finances. Personally I was very happy to not pay a mortgage for 5 years on my first home as the basement suite was rented for the cost of the mortgage payment. That helped me do a lot of other things, while simultaneously building equity. I was single at the time though, so it was an easie3r decision to make than it would be now with a wife and whatnot.

  11. #51
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    Quote Originally Posted by Misterman View Post
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    It's definitely not for everyone. It's a compromise in the name of responsibly stewarding finances. Personally I was very happy to not pay a mortgage for 5 years on my first home as the basement suite was rented for the cost of the mortgage payment. That helped me do a lot of other things, while simultaneously building equity. I was single at the time though, so it was an easie3r decision to make than it would be now with a wife and whatnot.
    This is exactly what I am doing at the moment. Not the basement suite but I just bought a property with carriage suite above the garage. Rent covers more than a half of mortgage payment so it's pretty cost effective.

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    Upon first mortgage 2.6x
    Just renewed, now 1.4x

    Window shopping currently,.. but I'm not overly bothered.
    Originally posted by sputnik
    Cell providers are the next Blockbuster video stores.

  13. #53
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    I was about 2.8x when I bought my place. Single, but I had a good down payment.

    If people are getting approvals for 5x and higher, I need to stop worrying about my renewal in two years
    See Crank. See Crank Walk. Walk Crank Walk.

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    Quote Originally Posted by FraserB View Post
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    I was about 2.8x when I bought my place. Single, but I had a good down payment.

    If people are getting approvals for 5x and higher, I need to stop worrying about my renewal in two years
    I think you'll be surprised at what you get approved for - it'll likely be a number you wouldn't even consider buying at. That's what happened to us anyway and I assume the industry is mostly the same.

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    Quote Originally Posted by FraserB View Post
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    If people are getting approvals for 5x and higher, I need to stop worrying about my renewal in two years
    Oh yeah, PCF approved $180K on $40K of income with 20% down. HSBC approved $260K on 20% down as well for a non-Canadian citizen.

    You bet your ass our whole country/bank is over leveraged and is the whole reason why stress test approval was implemented.

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    Quote Originally Posted by Mitsu3000gt View Post
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    I think you'll be surprised at what you get approved for - it'll likely be a number you wouldn't even consider buying at. That's what happened to us anyway and I assume the industry is mostly the same.
    I actually have no idea what I would have been initially approved for. I basically went to the bank and told them I need x dollars for the house I want.
    See Crank. See Crank Walk. Walk Crank Walk.

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    Quote Originally Posted by FraserB View Post
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    I actually have no idea what I would have been initially approved for. I basically went to the bank and told them I need x dollars for the house I want.
    Me too. We decided how much we were willing to spend and then just confirmed we could get that amount.

    The broker did mention for giggles how much we could have gotten approved for though. Was actually surprised how high it was even with the new tests.

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    I started with looking at new build condos with my friends in DT in 2012/13.

    Me: Tim, Can I borrow $250k for a condo?
    Tim: Banks said yes

    A week later
    Me: Tim, I'm actually looking at townhouses now. I need $350k?
    Tim: Banks said yes

    A week later
    Me: Tim, I want a detached now. How about $500k?
    Tim: Yup no problem

    All this on a new grad salary

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    Canadians are hugely overleveraged, in part because we keep relaxing the rules surrounding mortgages and propping up the RE segment. None of the above is surprising to me.

  20. #60
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    Banks will lend money to anyone they can make money off of within calculated risk. They'll just take your toys away if you can't pay so it's no skin off their back.

    You gotta be smart and look out for yourself and not let someone else tell you what you can borrow.

    The amount of consumer debt in North American is so fucking stupid.

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