Quote:
Originally Posted by Winsor_Pilates
To say 11X median income is very misleading.
What that really signifies is the Calgary has an extremely wealthy sector it historically didn't have who are increasing the range of home prices. The variation in Calgary home prices is much wider than ever before but so it the variation in income.
The wealthy are buying at prices much higher than the average, and historically the disparity was much closer.
There are people who make 11X the median income who can afford that price relative to how others afford theirs.
More telling is to look at actual median income and median price. Those numbers are about $90,000 and $350,000 which comes to 3.9.
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I'm not sure I understand what you are saying in regards to the median. The median is the sorted phyical numerical middle; for that to work wouldn't these higher income people be the only/most of the people buying and the rest with less income sitting on the sidelines statistically speaking? In theory, these outliers can't skew the median as much - which is why many like the median versus the mean/average metric.
Where does the $350,000 come from? I think the Calgary SFH median is currently $390,000ish (down from $425,000ish a few months ago.) Interestingly, inventory is going back up again in Calgary - pending the people who give up at the end of the month.
Quote:
Originally Posted by AFireInside
Of course Calgary is more affordable if you put $100,000 down on a $400,000 house....
The report is based on 25% down on a 25 year mortgage.
6 years ago putting 25% down on a 150,000 house was a little easier...... The only ones putting 100k down for a down payment are those who were in the market before the boom and made a killing. Wages haven't changed that much in the past 10 years to make up the difference. People saving up for a house aren't putting down 100k. 7 years ago could they have saved up 35 - 40 k over several years, or by selling a property for a small gain? Yup... Pretty tough for those who bought after 2005 to make 100k on their properties right now.
25% down is the only way someone making 90k a year can get approved for a 420,000 mortgage right?
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Can't seem to embed this image, but basically the average/median sure as heck isn't putting 15% down - let alone 25%. (I had linked it earlier.)
http://2.bp.blogspot.com/_0YOsyi5WbL...quity+5%25.Bmp