Home ownership in Toronto now harder than any point in past 25 years: report

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Kenneth Chan Aug 31, 2016 1:09 pm

Fewer and fewer Torontonians can afford to own a home in these market conditions, and the latest telltale sign comes from a new study that reveals 60% of median pre-tax household income is now used to service mortgages, utilities, and property taxes.

This figure climbs even higher to nearly 75% for single-detached homes; however, increases with condominium property ownership – now at about 45% – were far more modest in comparison.

A housing affordability update by RBC notes that these levels have not been experienced in the Toronto area for 25 years – since 1990, just before the housing market collapsed.

“By all appearances, rapidly deteriorating affordability had no restraining effect on supercharged demand,” reads the study. “Once again, the single-detached segment accounted for the lion’s share of deterioration, while condo apartments eroded more modestly on a relative basis. The Toronto-area market remains very tight with demand far exceeding supply, especially in the single-detached segment.”

But there are also some signs that the housing market could see some moderation later this year or early next year. The study says there are some potential signs that the market has reached its ceiling as monthly figures have indicated that home resales have fallen since hitting a high in May. Additionally, the number of new listings is growing after slowly falling throughout the first half of 2016.

Across the country, the effects of the housing market are most pronounced in the Metro Vancouver region where home ownership will cost 90.3% of household income, according to the same RBC study. And for a single-detached home in this West Coast city, it will now cost an astounding 126.8%.


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Kenneth Chan
National Features Editor at Daily Hive, the evolution of Vancity Buzz. He covers stories pertaining to local architecture, urban issues, politics, business, retail, economic development, transportation, infrastructure, and anything else that makes a difference in the lives of Canadians. Kenneth is also a Co-Founder of New Year's Eve Vancouver. Connect with him at kenneth[at]dailyhive.com

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