In a climate of sky-high interest rates, few new Ontario homeowners need the reminder that monthly mortgage payments are putting a deeper dent in the bank account as of late.
Naturally, high home prices in cities like Toronto and its surrounding suburbs only compound the situation.
But homeowners in some parts of Ontario have more relief on the monthly mortgage front than others. To examine how great this difference is throughout the province, Zoocasa analyzed the average home prices from five of the most affordable and expensive cities in Ontario. They then calculated how much homebuyers in these cities can expect to dish out in monthly mortgage payments, based on the average price.
The price gap between the priciest and the most affordable cities was a whopping $1.6M, according to the report. It highlights how the most notable price difference can be seen in expensive cities around Toronto and the Golden Horseshoe area compared to outer areas.
When it comes to the priciest city in the province to purchase a home, King – a largely idyllic township 40 km north of Toronto – takes that title. Here, the average home price is $1,927,333. This figure is nearly $1.6M more expensive than the most affordable city on Zoocasa’s list, Sault Ste. Marie. In Sault Ste. Marie – a picturesque region in northern Ontario in the heart of the Great Lakes – the average home price is $348,889 (a figure that sounds like a dream to young Toronto house hunters).
Subsequently, the average monthly mortgage payment in King is $9,003 – nearly $7,000 higher than Sault Ste. Marie, where homeowners pay an average monthly mortgage of $2,013.
Homes in King are nearly $400,000 more expensive than homes in the next most expensive city on Zoocasa’s list, Oakville. According to the report, Oakville’s low number of sales and predominantly luxury properties selling in the area contribute to the extremely high average price.
The massive gap in affordability throughout the province is the resonating theme of the report. “Windsor-Essex, which ranked fifth on our most affordable list, has an average home price of $554,277, nearly $900,000 less than the average price of a home in Richmond Hill,” it reads. “That’s a difference of nearly $3,500 on the monthly mortgage payments between the two.”
There is room for optimism for homeowners, however, and the report highlights that there are clearly pockets of affordability across the province (you just may have to move away to find them). “Canada’s average home price, according to the Canadian Real Estate Association, was $668,249 in July, with our five most affordable cities all ranking beneath that mark,” reads the report.
If a life in Sault Ste. Marie doesn’t do it for you, there’s always Thunder Bay, another region where you can find homes for less than $400,000, with the average price at $375,059 and a monthly mortgage payment of $2,164.
While neither of these spots may sit a close drive away from the sights and sounds of Toronto, the fact that the average monthly mortgage cost in both is the same price as a studio condo rental in the big city may just be inspiration enough for would-be buyers to direct their sights and hard-earned dollars north or northwest.