Market conditions are looking up for Canadian home buyers, but Toronto and Vancouver remain inaccessible to most. This is according to the latest RBC Economics Housing Trends and Affordability Report, which indicates housing affordability has improved for the second straight quarter of 2019.
Penned by RBC Chief Economist Craig Wright and Senior Economist Robert Hogue, the report states that the home-ownership dream is still alive in a majority of markets, with the most affordable being Saint John, St. John’s, Regina, Quebec City, and Halifax. It’s a different story in Vancouver, where only one in eight families earn enough to manage home ownership costs; and in Toronto and Victoria, where one in five families can fit the bill.
“Buying a more affordable condo apartment opens the field to close to two-thirds of families in most markets, but still, just one-quarter of them would be able to cover condo-ownership costs in Vancouver, and only one-third in Toronto,” the report states. “Severe affordability issues remain a major obstacle for all but the wealthiest in Vancouver, Toronto, and Victoria.”
Overall, RBC’s national aggregate affordability measure declined by 0.3 percentage points to 51.4 per cent in the first quarter of 2019, indicating slightly more agreeable conditions for potential home buyers.
Wright and Hogue attribute the uptick in housing affordability to policy-engineered market turndowns, and state that the trend is likely to continue, noting, “With interest rates no longer poised to increase and a still-positive outlook for household income, RBC expects a further slight improvement to Canada’s overall housing affordability picture in the near term. However, any improvement is likely to be incremental – especially as Toronto’s housing market continues to rebound.”
Read the full report here.