RBC's Housing Affordability Report, March, 2012


Below is a report by RBC on Canada's housing affordability using the cost of owning a detached bungalow as a benchmark to measure affordability. The percentage for the various cities represents the portion of pre-tax household income required to cover ownership expenses.

 The results for some key cities across Canada (change from previous quarter in brackets) are as follows:

  • Vancouver: 86 % (-4.6 % points)
  • Toronto: 52.2 % (-0.1 % points)
  • Montreal: 40.1 % (-0.7 % points)
  • Ottawa: 40.9 % (-0.1 % points)
  • Calgary: 36.7 % (-0.7 % points)
  • Edmonton: 32.8 % (-0.3 % points)
  • Halifax: 32.6 % (-0.3 % points)

By far, Vancouver remained the least affordable city in Canada to own a home. The estimated home ownership costs in Vancouver required 86% of a typical household's monthly income.

Home owneship in Vancouver will continue to deter prospective home buyers due to affordability problem.

Alberta enjoyed one of the more affordable housing markets in Canada. Both Calgary at below 37% and Edmonton at 33% are moderately affordable. With good employment prospects in Alberta, and low interest rates the housing markets there are expected to encourage buyers entering the market.

There was some hesitation from home buyers in Calgry in the fourth quarter of 2011 resulting in a relatively flat market in spite of 31,000 new jobs being created in Calgary in 2011.

Saskatchewan saw a surge in home resales, with affordability improving across most types of housing.

Manitoba experienced a slight deterioration in affordability in the fourth quarter of 2011. High demand and lower supply of homes resulted in home prices gaining in values, particularly for two-storey homes and condominiums.

Ontario's market continued to favour sellers as home buying interest was strong. At over 52% household income to afford a home in the province, housing in the province is considered unafforable, but not as bad as in Vancouver. 

Homebuying in the province reamained active in the fourth quater of 2011 and tight supply of homes fueled sellers confidence in holding their prices and in many instances asked for higher prices than previous sales of comparable homes. 

Quebec's housing market remained stable and affordable in the fourth quarter of 2011. In Atlantic Canada improvinng affordibility had resulted in an increase in resale activity in the second half of 2011.

The markets in Atlantic Canada region were generally balanced. A surge in demand in St. John towards the end of 2011, along with Halifax coulld have been attributed to a successful $25 billion bid for a major shipping contract.

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