Singles need more time to save for home down payment

Two heads are often better than one, and a new study shows that two savers are much better than just one when it comes to buying a home in Calgary.

The new study by Point2 Homes, an online real estate listings portal, found a couple saving for the average priced starter home in Calgary could save for a down payment in about 12.5 years less time than a single buyer.

The study cited a Calgary starter home costs about $285,000, requiring a couple two years and 10 months, based on median income, to save for a 20 per cent down payment.

In contrast, a single buyer could only qualify for a much smaller mortgage based median income, requiring a much larger down payment (about $145,000 versus about $57,000 for couples). In turn, that single buyer, saving 20 per cent of income annually, would need about 15 years and six months to have enough for a down payment.

Although sizable, Calgary’s gap is much less than the national average of nearly 25 years difference between couples and a single buyer.

One reason for the large gap nationally is markets such as Toronto, where the starter home costs $526,750. There, a couple requires about 12 years to save for a 20 per cent down payment to qualify for a mortgage.

That’s compared with a single individual, requiring nearly 36 years — based on median income and a 20 per cent annual savings rate — to come up with a down payment. That payment, the study posited, is about $420,000, given an individual buyer could only qualify for a mortgage of about $106,000 based on median income.