VANCOUVER (NEWS 1130) – Vancouver’s housing market has been named the least affordable in North America by Oxford Economics.
The city is joined by Toronto, Hamilton, San Jose, and Los Angeles in the top five least affordable metro regions. On the flip side, Chicago, Columbus (Ohio), Quebec City, Atlanta, and Raleigh (North Carolina) were considered the five most affordable.
“Unaffordability is a persistent issue in Toronto and Vancouver, and the recent price surge has served to exacerbate this more than decade-old trend,” the Oxford Economics report reads.
Researchers looked at how the price of a median home compared to what the median family could afford.
A rating of 1.0 was basically showing the maximum threshold. Vancouver’s was at 1.67 — three quarters of a point higher or, put another way, getting close to two times what families can afford and still pay for things like groceries.
While Vancouver’s index is down slightly from its peak of 2.0 in 2018, Oxford Economics notes it’s still “the most unaffordable market in the country.”
The authors of the report blame the pandemic’s impact on housing demand and supply economics as factors for the latest findings.
Greater Vancouver home sales have exploded in recent months, with March shattering a 10-year average.
The Canada Mortgage and Housing Corporation has forecast that rising prices and tighter budgets will persist for the next three years, cooling the local market.
While Vancouver and Toronto are among the cities singled out by the Oxford Economics report, authors note “Canadian housing affordability has worsened considerably over the past decade,” even in smaller metro areas.
“Nationally, our index reached 1.34 in Q1 2021, meaning the typical home in Canada was 34% higher than what the median income household could afford. The index has risen about 5ppts over the past year, as sharply higher prices were only partially offset by historically low mortgage rates and modest income gains,” the report reads.
However, Vancouver and Toronto have been described as “far out of reach.”
Read the report:Oxford Economics housing affordability