'Grim' outlook as housing affordability hits 31-year low
BNN Bloomberg
Housing affordability in Canada deteriorated to the worst level in 31 years in the third quarter of 2021, according to a new report from RBC Economics.
Housing affordability in Canada deteriorated to the worst level in 31 years in the third quarter of 2021, according to a new report from RBC Economics.
According to RBC Economist Robert Hogue, aggregate home ownership costs rose to 47.5 per cent of median household income in the latest quarter. That was a sequential increase of two percentage points and marked a nearly six point increase compared to a year earlier.
RBC includes factors such as mortgage payments, property taxes and utilities to measure ownership costs.
"The need for more supply has never been greater. This became clearly evident in the past year with bidding wars springing up in places that have rarely or never seen them before, and intensifying in places more accustomed to them. And until demand and supply return closer to balance, prices will continue to rise," Hogue wrote in the report.
Vancouver laid claim to the least affordable market, as ownership costs accounted for 64.3 per cent of median household income in the third quarter, up 0.9 percentage points from the previous quarter.
In Toronto, meanwhile, the proportion rose to 61.9 per cent, up 2.7 points from the second quarter -- which represented the most significant deterioration in affordability of all markets tracked by RBC.
