Though the logic is appealing, Canadian housing markets paint quite a different picture, with housing affordability worsening even though average housing prices have fallen.
The report tracks the income required to cover the cost of owning an average home with a 25 per cent down payment. When compared with the third quarter of 2015, the qualifying income had increased significantly by the third quarter of 2018. But rising prices were not the only factor. Even without their impact, the qualifying income would have climbed considerably because of the stress test that required the borrowers to qualify at a higher interest rate than the contracted rate as of January 2018.
The RBC Economics Report illustrates the peculiarities of housing markets where price alone does not determine the affordability of an asset. Certainly, the increase in housing prices eroded affordability. However, equally instrumental were the regulatory changes that also erected huge affordability barriers.
There're $400K small condos. There're million dollar houses. Some people want to pack a LOT more people into our cities with immigration. The definition of 'HOME' will need to change as a result. There won't be enough HOUSES for everyone. Everything needs to match...
Because we r not getting more overseas money!
Greed
The supply still has barriers caused by various governments.
Non-resident buyers. Chinese. It’s obvious.
illegal evictions so landlords can double and triple rent price. neighbour sees them get away with it and does same.