A study from RBC Economics shows that nationwide, its housing affordability measure increased 0.8 percentage points in the first three months of 2016 to 47.1 per cent, meaning homes were less affordable than at any time since 2010.
The national figure is heavily influenced by the hottest markets including Vancouver and Toronto along with Victoria, which has seen a sharp increase in prices relative to income, making the market less affordable.
“There is no imminent end to this divided picture because home resale activity is very strong in Vancouver and Toronto and demand in both markets exceeds supply by a wide margin,” said Craig Wright, RBC Chief Economist.
“The affordability of single-detached homes in Victoria is quite stretched compared to most cities across Canada, while the affordability measure for condo apartments eroded only slightly in the first quarter,” Wright said.
While prices in Calgary have eased since the oil slump, unemployment has grown, and the market has become less affordable. There is a similar situation in Edmonton.
In Saskatoon, there was a marginal decline in affordability while homebuyers should find it easier to afford homes in Regina with affordability at a 9-year high.
Winnipeg has reached a 6-year best for affordable homes and Halifax also became more affordable. Saint John was the most affordable market of all those surveyed.
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Housing affordability across Canada is divided into markets soaring to record highs and those that are creating new opportunities for first-time buyers.