No doubt you have thought about the affordability of the current Canadian housing market and chances are you have even thought about where houses prices will go in the future! Maybe you have parents that tell you stories of a different time when they bought their first house for less than you paid for your first car. Inflation accounts for some of the increase in prices, but there has to be something else (most likely lots of something elses).
In a recent study completed by Statistics Canada called: Employment patterns of families with children, 1976 to 2014, the study noted that…
“In 2014, 69% of couple families with at least one child under 16 years of age had two working parents, up from 36% in 1976.”
Said in another way (as it relates to affordability of housing)
In 1976, 36% of couple families with at least one child under 16 years of age had two working parents contributing to household income (including the mortgage). In 2014, this number jumped to 69%.
With almost 7 out of every 10 families having the ability to qualify for their mortgages using two incomes, it is no wonder that over the last 30 years house prices have increased significantly. As income is the main driver in affordability, double income families have more income than most single income families, so they can afford to spend more on housing.
So what does all this mean to you?
Well… if you are a single person or one half of a double income family, housing prices continue to go up, making housing less affordable. If you are considering getting into the market, making sure you look at all the mortgage options available to you and having a plan to pay off your mortgage is essential.
We here at Dominion Lending Centres would love to discuss your specific financial situation in order to help you arrange financing to purchase a home that suits your personal and family needs.
Contact us anytime!
Here is the complete study from Statistics Canada for your reading pleasure
Study: Employment patterns of families withchildren, 1976 to 2014
Released at 8:30 a.m. Eastern time in The Daily, Wednesday, June 24, 2015
In 2014, 69% of couple families with at least one child under 16 years of age had two working parents, up from 36%in 1976. This proportion increased in every province, but not equally among provinces.There were 2.8 million couple families with at least one child under 16 in 2014—the same number as in 1976.However, the number of such families with two earning parents rose from 1.0 million in 1976 to 1.9 million in 2014.Three-quarters of dual-earner families had two parents working on a full-time basis in 2014. This compared withtwo-thirds of dual-earner families in 1976.The share of couple families who had one working parent—single-earner families—declined from 59%in 1976 to 27% of couple families with children in 2014.The proportion of couple families with no working parents was 4% in 2014. This compared with less than 6%in 1976.
The number of families with a stay-at-home parent declines
Among single-earner families, some had a working parent, and a parent that was unemployed, going to school or permanently unable to work. Others had a working parent and a stay-at-home parent.Between 1976 and 2014, the number of single-earner families with a stay-at-home parent declined from 1.5 millionto 500,000. In other words, couple families with one stay-at-home parent represented less than one-fifth of couplefamilies with children in 2014, down from more than half in 1976.In 11% of cases, the stay-at-home parent was the father in 2014. This was the case with less than 2% of couplefamilies with a stay-at-home parent in 1976.
Provincial differences in dual-earner families and families with a stay-at-home parent
Both the proportion of dual-earner families and families with a stay-at-home parent varied among provinces.In 2014, Saskatchewan (74%) and Quebec (73%) had the highest proportions of dual-earning families amongcouple families with children. In 1976, the corresponding proportions were 40% for Saskatchewan and 29% for Quebec.The lowest proportion of dual-earner families was in Alberta, with 65% in 2014. Alberta, however, had the highestproportion of dual-earner families in 1976 (with 43%), which suggests that the proportion of dual-earner familiesrose less rapidly in this province.
Courtesy of Joe Tomkins, AMP – DLC Canadian Mortgage Experts
