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How much you need to earn to afford a home in Toronto and the GTA

“What can I afford?”

To help answer that question, let’s calculate what level of salary you or your household are going to need to make in order to purchase a home, based on average prices in 2017 so far.

First, we looked at prices for the entire Greater Toronto Area (both the 416 and suburban 905) by property type.

There’s no debating the numbers are overwhelming. But it’s important to note, the salaries represent entire household incomes and not just that of a single person.

Along with providing a broad overview of the region’s market, we also dug up numbers on a per-city basis, looking into prices for all property types (pooling together detached houses, semis and condos).

Source for graphs: TheRedPin

How the numbers were calculated

If you’ve secured a pre-approval before, it’s likely a mortgage professional has already put your finances to the test using the GDS Ratio. Short for Gross Debt Service Ratio, this calculation adds up all your expenses (mortgage payments, utilities and taxes) and divides that number by your entire household salary.

If your GDS works out to be 32 per cent (or anything below) a property officially falls in your price range.


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