RBC has issued its Housing Affordability Measure report, which finds that housing in Canada is affordable in 12 of the 14 urban markets, unless you live in Vancouver or Toronto.
With Vancouver’s market consistently breaking records, many are aware of the high prices, but aren’t up to date on how severe it’s getting. The city saw an enormous rise between 2015-2016, which leads to Royal Bank economists placing the market in the “dangerously unaffordable” level.
Economists also predict that as long as mortgage rates remain low, the city will be stuck in this level as the demand for single family homes exceeds the current supply.
The RBC report points out that for a household with a 25-year mortgage and average income, they will have to rely on nearly 110 per cent of their disposable cash to afford owning a single, or detached home and keep up with utility bills and taxes.
“It has never been so unaffordable to own a single detached home in the Vancouver area,” reads the report.
The Canadian government introduced new measures to cool the housing market earlier this month, but many are under the belief it won’t help the big picture.
Toronto’s affordability levels are currently moving the city into “risky levels”, but low interest rates has helped keep demand high.