A new report warned that genuine housing affordability in Canada is only achievable if average earnings double (up to $93,400 annually), or if average home prices drastically shrink by half of their current values (a decline of approximately $223,000)
These are essentially impossible conditions to achieve even in the long term. The trends emphasized the crucial role that improved supply of “purpose-built rental housing” will play in ensuring homes for the greatest possible number of Canadians, according to the non-profit housing advocacy organization Generation Squeeze.
“There may be a little bit of emerging apathy amongst leaders right now because they’ve been hearing from the real estate industry that home prices are no longer rising at their historically high profitable levels where they were a couple of years ago,” report lead author and University of British Columbia policy professor Paul Kershaw told CTV News.
“If home prices are levelling off right now, they’re levelling off at near historic highs.”
In Ontario, affordability will only be reached if salaries go up to $109,000 per year, or home prices decrease by $307,000. This is even worse in BC, where average earnings would either need a massive three-fold increase to $136,200, or average prices decline by $452,000.
And “it’s not just Toronto or Vancouver,” Kershaw warned.
“The gap is large in Victoria. The gap is large in Kelowna. It’s large in multiple cities like London, Kitchener, Ottawa and Hamilton. There’s a gap that’s problematic in Calgary, Fort McMurray, Edmonton, Halifax, Montreal, etcetera. Even Manitoba has crossed the threshold where home prices are challenging for younger Canadians.”