A new affordability report from a global economics consulting firm has named a trio of Canadian housing markets as the least affordable on the continent.
The North America Housing Affordability Indices from Oxford Economics placed Vancouver, Toronto and Hamilton in its top three least affordable markets, commenting that the US was generally more affordable than Canada when it came to housing.
Two cities in California — San Jose and Los Angeles — rounded out the top five least affordable housing markets. Meantime, Quebec City got the nod as one of the continent’s most affordable markets, joining Chicago, Columbus, Atlanta and Raleigh.
Economists Oren Klachkin, Tony Stillo and Michael Davenport authored the report, which assesses affordability based on the relationship between the median single-family home price and the median household income for each metropolitan area studied.
Canada’s overall Housing Affordability Indices was 1.34 in 2021’s first quarter, meaning a home was 34 percent more expensive than the median household income would be able to afford on a national level.
The economists wrote in the report that this deteriorating affordability trend may have worsened during the pandemic as home prices surged, but it’s only part of a decade-long trend which has affected the country’s most expensive markets — Toronto and Vancouver — as well as smaller cities.
Vancouver’s affordability reading, according to Oxford Economics’ index, has actually improved since 2018, sitting now at 1.67 down from nearly 2.0 a few years ago. Toronto hit an all-time high of 1.53 in the first quarter while Hamilton jumped to 1.5.
Oxford Economics says that a reading between 0.9 and 1.1 places a market in the affordable zone. Along with Quebec City, Edmonton, Winnipeg, Calgary and Montreal are all considered affordable while Ottawa’s skyrocketing home prices have caused its reading to shoot up to 1.29.
