With the cost of houses ever increasing, getting into the real estate market seems to be a struggle for first time homebuyers.

Here are some fun facts:

The average price of a home in Hamilton in 2022 is $976,423 up from $721,178 in 2021. (For more details CLICK HERE).

The average salary in Ontario is $134,000 (ACCORDING TO SALARY EXPLORER).

Quick math tells me that the average person cannot qualify for an average home in Hamilton. Let’s not even LOOK at prices in Burlington ($1,369,337, because – curiosity).

After speaking to a few Realtors, I’ve learned that most first time homebuyers are couples with double incomes and flexible jobs. Many of those buyers do not have kids and most are using savings for their down payments. Depending on who I speak with, these buyers are between 30 and 35 years old.

When we are calculating how much a client can afford to spend on a home, we must look at their liabilities. Student loans, lines of credit, credit cards, and car payments all affect how much mortgage you can qualify for.

Meet Walter

Walter is 28 years old with a great job no student loans or credit card debt. Walter thought he was in perfect shape to purchase his first home. What he wasn’t taking into consideration was his $850 a month car payment.

This is what Walter looked like on paper:

Income: $104,000

Income Type: Salary

Down Payment: $80,000

Credit Score: 680 – 799

Maximum Purchase Price (no car): $641,243

Maximum Purchase Price (with car): $580,486

Walter’s home buying power was reduced by $60,757 because he purchased a car with a large monthly payment.

Don’t be Walter.

If you’re thinking about buying a home SCHEDULE A CALL with me to find out what you can qualify for (or APPLY ONLINE); with and without that shiny new car.

Your Mortgage Pal,

Donna