Vancouver, Toronto among most ‘severely unaffordable’

Vancouver, Toronto among most ‘severely unaffordable’

By Ysh Cabana
The Philippine Reporter

Toronto ranked as the 10th most unaffordable city out of 293 cities in the world in the latest Demographia International Housing Affordability Survey. This is up way from 21st place the year before.

The report measures middle-income housing affordability in 92 major metropolitan housing markets, which includes Australia, Canada, Hong Kong, Ireland, Japan, New Zealand, Singapore, the United Kingdom and the United States.

The survey found that two out of Canada’s six housing markets, Toronto and Vancouver, are “severely unaffordable.”

“High evidence of overvaluation is still observed in Vancouver, Victoria and Toronto where house prices remain higher than levels supported by economic and demographic fundamentals,” according to the 2018 Third Quarter Canada Mortgage and Housing Corporation (CMHC) assessment, sourced in the report.

Toronto has a severely unaffordable housing market due to a more than doubling of middle-income house prices relative to incomes since the first annual survey from 3.9 in 2004 to 8.3 today. The 2018 UBS Global Real Estate Bubble Index also rates Toronto as having the third worst housing “bubble risk” in the world.

Markets in the extended Toronto area (the “Greater Golden Horseshoe”) have also become severely unaffordable, according to the report. That includes Hamilton, Guelph, Kitchener-Waterloo, Peterborough, Cambridge, Oshawa, Barrie, St. Catharines-Niagara, and Brantford.

Meanwhile, the most affordable markets in Canada are Moncton, NB, Cape Breton, NS, Fort McMurray, AB, according to the report.

The 15th annual Demographia International Housing Affordability Survey is published by the Frontier Centre for Public Policy, an independent Canadian think tank. The rankings include 309 metropolitan areas across eight different countries with more than 2 million residents.