Houses Under $500,000 a Disappearing Breed

Remember when half a million bucks used to be a lot of money?

For those who didn't get the memo, apparently it has stopped being a lot of money for house shoppers in Canada.

You can still buy an average home in Canada for a half-mil, if you time travel back to March 2016. That's the last time the national "benchmark" detached dwelling cost that much. Since then, it's smashed the $500k barrier and zoomed another 62%.

Where Do You Live if $500k is Your Breaking Point?

Here’s a sample of what you can buy if you are bargain shopping at $500,000 (see link).

If you like the Maritimes, the Prairies or smaller pockets of Quebec and Ontario, you’re "living large."

If your livelihood happens to be in the GTA or GVA, sorry about your luck.

Even a prototypical 'burb like Milton, ON — 45 minutes from downtown Toronto on a good day — returns the dreaded “No results” when searching for that $500k unicorn on Realtor.ca.

If you want to drive (or Go Bus and then Go Train) a little further — from Cambridge, Ontario, for example — your dollars go further. House listings actually appear on Realtor.ca at that price point. But if you’re working down in the big city, you better enjoy 1.5-hour commutes.

“Drive till you qualify” has been a mortgage industry mantra for years. But to know how far you need to drive, you must first know what you qualify for. That’s a number best provided by a professional mortgage broker or lender advisor, but here’s a quick mortgage affordability calculator to give you a sense.

Quick example: $100,000 of household income and no other debts will get you close to that mystical $500,000 price point for a single-family home, assuming you have the minimum 5% ($25,000) down payment. (By the way, only about 29% of Canadian families earn that much, and only 16% of individual earners.)

If you’re an average Canadian family whose bread winner(s) can work remote, your best shot at a half-mil house may be in a small town. Check out the best such towns in RATESDOTCA’s 2021 Livability Report.

If you have to clock in at a business-place each day, and you don't have a ton of assets, your options are more limited — even with a six-figure income and minimal debt. That is, unless you have the great equalizer: well-off generous parents.