Back in our parents' and grandparents' day, buying a small starter home in the Toronto area for around two to three times your annual household income was not only a possibility, but the norm.

But as Canadian real estate prices have expanded outrageously faster than incomes over the years, that basic life step has turned into a pipe dream.

With the average home in the city now over $1.1 million and mortgage rates hitting levels not seen in over a decade, the concept of an affordable "starter home" doesn't really exist anymore — or rather, hardly at all, since Point2Homes has actually found a few places in even Ontario where you can still get a cheap(er) home.

Gauging a starter home as one that is half (or less) of the median price of a home in any given city, and taking into account the median household income of current renters, the real estate listing site has shared where prospective homeowners can still land a "starter home" that isn't absolutely beyond their means, and is still in an actual city.

"Cheap homes no longer mean what they used to," the company writes in a new report. "Rising home prices and high mortgage costs mean renters in Canada's most populous cities are finding it increasingly hard to switch to homeownership. Dwindling inventory doesn't help, either."

According to the findings, renters in 36 of the 50 largest cities in Canada — and 24 of the largest in Ontario —  cannot afford to buy their first home where they live, even at this much below the benchmark price.

In Toronto, for instance, renters typically make about 46 per cent less than needed to afford a home at or less than half the median price, with the average household grossing $70,422 per yer, compared to the $129,678 income Point2Homes says you would need to buy a "starter home" in the city.

In Richmond Hill, Oakville, Markham, Vaughan, and Burlington, renters have it even worse, making 53 to 59 per cent less than required.

But with so many cities where renters can’t buy a starter home — most of them in Ontario — there are still some locales where renters can, if you're willing to relocate. And in these spots, it's surprsiingly all about the income level, and less about real estate pricing.

"Starter home prices are very similar in Windsor, ON and Calgary, AB," the company writes. "But while the renter household income in Windsor is $40,241, in Calgary it’s close to $69,000. This means that Calgary renters make 5 per cent more than what they would need to comfortably afford a mortgage, and Windsor renters earn 48 per cent less than the amount necessary to buy a starter home."

These more affordable cities include Edmonton, St. John's, Regina, Winnipeg, Saskatoon, and a ton of Quebec municipalities.

The firm notes that while a starter home in Canada could in recent decades be considered one around $200,000, "it’s the market that dictates the definition of the starter home," with prices of even a starter home in the 14 least unaffordable cities over $500,000.

For them, it is key that for a home to fit the terminology, it can't necessitate mortgage payments of more than 30 per cent of a household's monthly income (assuming a typical 20 per cent down payment is secured at a 5.75 per cent fixed mortgage rate over 25-years).

BlogTO(June 23, 2023, Becky Robertson)