Best rates can be found outside major cities

Best rates can be found outside major cities

Best rates can be found outside major cities

With the cost of buying a home in major Canadian cities becoming financially proscriptive, it’s time to start advising clients to search on the fringes.

And according to, that’s where some of the best mortgage rates are, too.

“There’s definitely a lot of opportunity outside of the major cities,” said Jacob Black, managing editor at “Broadening the search in some of the outlying areas of cities is helping people get involved in the mortgage market. People are exploring different ideas to finance a home, but it also includes shopping around for mortgage rates.”

The cost of a benchmark house in Toronto is $873,100, meaning only 10% of income earners (making at least $160,000) can afford it—not as bad as Vancouver’s $1,441,000, where only the top 1% of income earners ( who make at least $240,000) can afford that, but definitely prohibitive.

“My returning clients are looking outside the city,” said Toronto-based mortgage broker Daniel Johanis of Rock Capital Investments. “If they’re not going to the suburbs, they’re going to secondary markets like Hamilton and Kitchener-Waterloo.”

Johanis has also seen some of the novel financing ideas Black alluded to.

“I’ve seen enough co-op buys where multiple families live in one home,” said Johanis. “It’s obviously a larger purchase price, but some will do a legal basement so they can rent it out and make some of the money back. Of course, there’s also the bank of mom and dad to help with the purchase price’s overall affordability.”

According to Black, Canada doesn’t have an overpriced housing market; it’s merely overheated. The more expensive it becomes, the more desperate people become to get in lest they get priced out in the future. It’s also a problem Black says exists in most of the world’s major cities.

But in the Greater Toronto Area, housing hasn’t grown beyond reach provided buyers look in the right places.

“You need to earn well and truly be above the top 10% to purchase a house in Toronto, so people are moving to Brampton, Mississauga, Whitby, Ajax, north Oakville,” said Black. “If you broaden your search, you can find a home that suits your needs. There’s only so much stock in the marketplace to begin with, so having to make new decisions and compromises about where to live has become a new reality.”