How Long Will It Take to Save for a Down Payment While Earning Minimum Wage?

For many Canadians, owning even the most affordable type of home, an apartment condo, would be a dream. Still, it often feels impossible for those earning minimum wage—and in many cases, it is. As reported by the Canadian Labour Congress, one in five Canadian workers earns less than $15 an hour, so the financial barriers to homeownership are overwhelming.

Zoocasa analyzed how long it would take for a person earning the minimum wage in their province to afford an average-priced apartment condo. For this analysis, it was assumed that a person would save 7.2% of their annual income, consistent with Statistics Canada’s Q3 2024 household savings rate, to build their down payment. The disparity between incomes and housing costs poses significant challenges, even in Canada’s more affordable cities. Zoocasa’s mortgage calculations are based on a 25-year term, using the minimum down payment and a 20% down payment, with an interest rate of 3.99%.
Saving for an apartment condo down payment in Canada is increasingly unrealistic for many minimum-wage workers, especially in metropolitan areas. In cities like Vancouver and Toronto, saving the minimum down payment on an average income would take nearly 29 years and 27 years, and over 83 years for a 20% complete down payment.

Where Can Minimum Wage Workers Realistically Afford to Buy?

In 13 regions, saving for a 5% down payment takes less than 15 years with a 7.2% savings rate. The problem is affordability. Even with a smaller down payment, monthly mortgage payments are too high for many people. A 20% down payment can lower monthly costs. However, saving this recommended down payment still takes over a decade in most cases, and that’s only if a person can make the monthly mortgage payments after they reach their financial goal. Ultimately, this situation means a person saving for a down payment while earning minimum wage must double or triple the recommended savings amount of 7.2% of a person’s salary.

Even in more affordable cities like Edmonton and Winnipeg, saving for a 20% down payment would still take 25 and 30 years respectively, which adds to almost the entirety of a person’s career. Worse still, even if someone saves enough for the minimum down payment, monthly mortgage payments would be far out of reach.

For example, Hamilton is widely regarded as a more affordable living alternative to Toronto, offering lower housing costs and a convenient commute compared to other Greater Toronto Area (GTA) areas. However, the reality for minimum wage earners tells a different story. A 20% down payment on Hamilton’s average apartment-condo price of $468,700 is $93,740, which is nearly three times the annual income of a single minimum-wage worker.

Monthly mortgage payments of $1,970 consume a staggering 98.6% of their income, leaving virtually nothing for essentials like food, utilities, or transportation. While Hamilton’s mortgage costs are $1,062 less than Toronto’s, they remain far beyond what a single low-income earner can afford.
Often seen as a thriving hub for those looking to move away from the GTA, Kitchener–Waterloo has an even higher affordability gap. The average apartment-condo price of $484,429 requires a 20% down payment of $96,886, with monthly mortgage payments totaling $2,036. This payment eats up 101.9% of their monthly income for someone earning minimum wage, leaving no room for other expenses. While Kitchener-Waterloo is a growing community with its appeal, it remains out of reach for low-income individuals, and even double-income households would face significant financial strain.

Edmonton and Winnipeg: The Possibility of a Down Payment in Double-Income Households

A “living wage” is the hourly rate a worker needs to earn to cover basic expenses and maintain a modest standard of living, considering government transfers and taxes, as explained in a recent report from Vibrant Communities Calgary and The Alberta Living Wage Network. In Calgary, the living wage is $24.45 per hour. This is nearly $10 more than Alberta’s current minimum wage, representing an increase of 63% needed to reach this financial security.

In contrast, Edmonton’s living wage is slightly lower, at $20.85 per hour. Edmonton and Winnipeg present challenges similar to those faced by single minimum-wage earners in other cities, but they offer the most realistic opportunities for double-income households. With an average apartment-condo price of $191,413 in Edmonton, monthly mortgage payments of $994 consume 58% of a single earner’s income. While this is far from affordable for one person, a double-income household earning $3,448 a month would see housing costs drop to 29% of their combined income, comfortably within the recommended 32% threshold.

Winnipeg offers a similar outlook where it’s realistically impossible to meet the mortgage payments as a single worker earning minimum wage. With an average apartment-condo price of $225,944 and a minimum down payment, the monthly mortgage payments of $1,173 consume 67% of a single earner’s income. For a double-income household earning $3,478 a month, this drops to 34%, slightly over the threshold but still more feasible than in most other cities. Even in these more affordable cities, homeownership may still involve significant financial sacrifices, highlighting the gravity of the issue.

The latest data from the Canadian Centre for Policy Alternatives show that the living wage in Winnipeg rose to $19.21 per hour in December 2023, three dollars more than the current minimum wage.

The Challenge of Comparatively Affordable Markets

The affordability gap widens further in cities like Saskatoon, Calgary, and Windsor. Saskatoon’s monthly mortgage payment of $1,674 equals 98% of a single minimum wage worker’s income, leaving no room for essentials.

Saskatchewan raised its minimum wage to $15 an hour on October 1, 2024, a total increase of $1.

In an interview with Regina Leader-Post, Craig Pickthorne, the Ontario-based director of communications for Living Wage Canada, explained: “So while those working at minimum wage are getting a seven-per-cent raise, we can see it is still $3.95 short an hour from being able to cover all your bills,” he said. Nobody could make ends meet in Regina or Saskatoon working minimum wage full-time, even after this year’s increase.”

Meanwhile, Calgary’s $1,774 mortgage payment exceeds a single worker’s $1,724 monthly income by $50, making it unaffordable even before considering other costs.

Windsor, despite its reputation for affordability in Ontario, has mortgage payments of $2,100, which consume 105% of a single earner’s income. Even for double-income households where two people make minimum wage, these payments take up over half of their combined earnings, well beyond the affordability threshold.

A Nationwide Struggle

Across Canada, the affordability crisis extends to significant urban markets as well. Even with a 20 percent down payment, Vancouver and Toronto have mortgage payments that consume over 120% of minimum wage workers’ incomes. The challenge is that larger city centers, where housing costs are highest, are also where many minimum wage jobs are concentrated, such as food service, hospitality, or delivery service workers.

Even in Edmonton and Winnipeg, which offer the most promise, single minimum wage earners face challenging financial strain. Though with sacrifices, these two cities provide the most realistic options for double-income households.

The Complex Path to Homeownership

While some cities may seem affordable on paper, the reality for minimum wage earners paints a bleak picture. Homeownership requires dual incomes and financial discipline, even in Edmonton and Winnipeg, the country’s most affordable markets. Cities like Hamilton, Kitchener-Waterloo, and London St. Thomas may appeal to middle-income buyers, but they still need to be attainable for low-income earners. For those dreaming of owning a home, the affordability gap is a sobering reminder of the growing challenges in Canada’s housing market.

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