gold

Photo: Bullion Vault/Flickr

Toronto homes have been more expensive on average before — if you’re paying for them in gold, that is.

In an exercise included as part of a recent note sent to clients, BMO Chief Economist Douglas Porter shows how.

The economist converts average Toronto home prices dating back to 1980 into their equivalent in ounces of gold.

Porter runs through the numbers: an ounce of bullion was nearly $1,700 last month, while the average price of a home in the GTA was around $921,000.

“Dividing home prices by the [Canadian] price of gold, and voilà… it required just under 542 ounces of the yellow metal to buy the average GTA home,” Porter calculates.

Not too shabby.

“True, that’s much higher than, say, five years ago,” Porter concedes.

canadian-home-prices-gold Chart: BMO Economics

“But, it’s been higher in the past — around 2004/05, when gold was weak, and in the late 1980s, when Toronto was in full bubble mode,” he adds.

Indeed, around the midway point of the first decade of the new millennium, Toronto homes cost well over 600 ounces of gold.

That’s about 48,473 avocado toasts at $19 a pop, for the Millennials out there.

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