Here's how much you need to earn to buy a home in Ottawa

The amount of money Ottawa residents needed to earn to buy a new home dropped $4,670 in May compared to a year ago, as the average cost for a new home dropped more than $60,000 in Ottawa.

The amount of money Ottawa residents needed to earn to buy a new home dropped $4,670 in May compared to a year ago, as the average cost for a new home dropped more than $60,000.

A new report by Ratehub.ca, an online mortgage brokerage service, shows homebuyers needed an average income of $130,000 to purchase a new home in Ottawa last month, down from $134,670 in May 2022.

The income required to purchase a new home decreased despite a rise in the mortgage rate to 5.39 per cent and an increase in the stress test rate to 7.39 per cent in May.

The survey shows the average cost of a home in Ottawa dropped from $709,100 in May 2022 to $645,400 in May 2023.

"With home prices lower in most cities, it’s not surprising that affordability has improved in May 2023 vs. May 2022," James Laird, co-CEO of Ratehub.ca said in a statement.

Ratehub.ca says the report shows how changing mortgage rates, stress test rates and real estate prices are impacting the income needed to buy a home.

Ottawa had the third-highest decline in income required to buy a home out of 10 markets across Canada.  The average income required to buy a home dropped $9,520 in Hamilton and $7,160 in Victoria.