What Can a Government Clerk Afford to Buy in British Columbia?

Alyssa Furtado
by Alyssa Furtado July 24, 2013 / No Comments

Flickr: Old Shoe Woman

Buying your first home isn’t easy – especially in British Columbia, home to Canada’s most expensive housing market. In this series, we are going to look at the average starting salary of a profession, assume a buyer has no debts and see what they could afford to buy in their city or province.

The housing market in British Columbia has been declining in recent years, as a result of skyrocketing home prices that pushed many potential buyers out of the market. Prices have started to go down, but British Columbia is still the most expensive housing market in Canada. In British Columbia, a government clerk can expect to make an average starting salary of $38,754 per year. And if you are earning this salary and don’t have any major debts, you may be able to afford a home in the province.

After running the numbers through our mortgage affordability calculator, a government clerk in British Columbia earning $3,229.50 per month (x 12 = $38,754 per year) with no major debts could afford a home priced at $273,895. This figure is based on a down payment of $55,650 (20%), an amortization period of 25 years and a 5-year fixed mortgage rate of 3.23%. Most lenders determine your maximum affordability using your debt service ratios – that is, your gross debt service ratio (GDS) and your total debt service ratio (TDS). GDS and TDS are explained further in our education centre. For now, let’s take a look at what types of homes you could buy at this price in British Columbia.

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Property #1: Downtown Condo
Location: 930 Yates Street, Victoria
Asking Price: $269,900
Features: 2 Bed, 2 Bath
Approximate Square Footage: 716
Property Taxes: Approximately $121/month
Parking Spaces: 0

This two-bedroom condo is located in Downtown Victoria and has a perfect walkability score (100). If you were to run the numbers for it through our British Columbia mortgage calculator – using a 20% down payment ($53,980), a 5-year fixed mortgage rate of 3.23% and an amortization period of 25 years – your monthly mortgage payment would be just $1,047. When you add in other monthly costs, such as property taxes ($121 per month), you can see that only $1,168 of your income would go towards housing each month. Not bad, right?

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Property #2: Suburban House
Location: 42 Lekwammen Drive, Esquimalt
Asking Price: $269,500
Features: 2 Bed, 2 Bath
Approximate Square Footage: 1,336
Property Taxes: Approximately $121/month
Parking Spaces: 2 (Garage)

If you prefer to live in a larger home on the outskirts of a major city, you’re in luck. This suburban home is located in Esquimalt, just outside of Victoria. Again, if you run its numbers through our mortgage payment calculator – with a 20% down payment ($53,900), a 5-year fixed rate of 3.23% and an amortization period of 25 years – your mortgage payment would be just $1,046 per month. Factor in the monthly property taxes ($121 per month) and you could pay just $1,167 per month to own a home only 10-15 minutes from the downtown core.

In the end, the home you choose will depend on your needs and wants. While many people are willing to commute to work, in order to live in a larger home, many others are not – and that’s ok. The fortunate news is that a government clerk in British Columbia can afford to become a homeowner, no matter which type of home they prefer.