Canadian Housing Affordability Index
Benjamin Thompson Kirk
In Canada, The Housing Affordability Index measures the percentage of disposable income required to service the monthly mortgage payments on a property.
Benjamin Thompson Kirk
At the start of the pandemic – because of rate cuts – the index fell to 30%, which is more than 6 points lower than it stands today. Within a twelve-month period, the affordability of real estate in Canada went from being the most affordable in a decade to the least.
Affordability on the Rise Again Between the second quarter of 2020 and the second quarter of 2021 housing affordability improved again in Canada. The home value to income ratio, previously at 47.3%, dropped to 45.3%; in Vancouver, the ratio stood at 63.5%, down from 74.7%.
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The home value to income ratio, previously at 47.3%, dropped to 45.3%; in Vancouver, the ratio stood at 63.5%, down from 74.7%.
Regional Housing Affordability Toronto and Vancouver have struggled with housing affordability largely because of high demand, low supply, and the end of the pandemic-induced cut in interest rates; both cities remained at the bottom of the list in terms of affordability in Canada. The most affordable city in Canada to buy a home currently is St John’s, NL – previously this accolade was held by Regina, SK.
For more information about the real estate market and housing affordability in Canada, visit the blog of Benjamin Thompson Kirk.