Vancouver, Toronto ranked among world's most unaffordable cities for homebuyers
Canadians struggling to afford homes in major cities won't be surprised by a new global report naming Vancouver and Toronto as "impossibly unaffordable."
The annual report from Demographia, which analyzes housing affordability across 94 major markets, ranks the two Canadian cities among the most expensive in the world based on their median home price to income ratios.
Vancouver scored 12.3 on the affordability metric, the third-highest ranking globally, while Toronto came in at 9.3, placing it 11th on the list of least affordable cities.
"This is a long time coming. We haven't been building enough housing, we certainly haven't had enough government investment in affordable housing for decades, and the chickens are coming home to roost," said David MacDonald, a senior economist with the Canadian Centre for Policy Alternatives.
The rankings compared median home prices to median household incomes, with a score below 3.0 considered "affordable." Vancouver and Toronto were among just a handful of cities globally to eclipse the new "impossibly unaffordable" threshold of 9.0 or higher.
"Buying a property right now, I feel it's almost out of the question for me and my partner. We just can't afford to do it," Vancouver resident Aman Fiseha told CTV News. "We have considered potentially looking at opportunities in the United States."
The report cited a housing supply shortage as the main driver of the crisis in the countries studied, including Canada, where the Canada Mortgage and Housing Corporation estimates 3.5 million more homes are needed by 2030 to restore affordability.
Among other major Canadian cities, Ottawa (5.3) and Montreal (5.8) were rated "severely unaffordable," while Calgary (4.6) ranked as "seriously unaffordable." Edmonton (3.6) fared marginally better, being rated "moderately unaffordable."
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Some prospective buyers are getting creative to break into the pricey markets. "People are teaming up with friends and family to co-buy properties and get in," said Tom Storey of Royal LePage Signature Realty.
The federal government has earmarked billions for housing, but the Demographia study found nearly 90% of cities analyzed failed to meet the basic "affordable" threshold, underscoring the global nature of the home price crisis.
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