Vancouver, Toronto and Hamilton are the least affordable cities in North America: report
Hamilton is less affordable than Los Angeles and New York City according to new Oxford Economics research
Vancouver, Toronto and Hamilton are, according to new research, the least affordable cities in North America.
Vancouver was the least affordable city, with Toronto in second place and Hamilton in third. All three are more expensive places to live than New York and L.A.
The report, from Oxford Economics, published on Tuesday, said homes in Canada are 34 per cent more expensive than the median-income household could afford.
"Canadian housing affordability has worsened considerably over the past decade, not only in Toronto and Vancouver, but also in several smaller metros," read the report.
"Hamilton and Ottawa have joined the ranks of Canada's least affordable metros, while homes in the Prairies and Quebec remain within reach of local households."
According to the Canadian Real Estate Association's MLS system, the average national price now stands at $716,828. In Vancouver and Toronto that's about enough to buy a one-bedroom condominium. In Hamilton, you can find a home with three bedrooms inside 1300 sq. ft. listed in that price range.
Oxford Economics used new North America Housing Affordability Indices (HAIs) for 25 cities in the continent. The report compares whether the median income household in a city can afford the median-priced home.
Ottawa was the sixth least affordable, Montreal was ninth least affordable (tied with New York).
Meanwhile, Quebec City was third most affordable, Edmonton was sixth, Winnipeg was eighth and Calgary was 10th.
"Our HAIs reveal that housing is, and will remain, much more affordable in the US than in Canada," read the report.
With Vancouver and Toronto being the least affordable cities in the sample, the report states the cities are "far out of reach," noting Ontario's affordability has "worsened considerably over the past decade."
The report said its HAIs in Canada assume a 39 per cent gross debt service ratio (the threshold that most Canadian lenders use to qualify borrowers) and a 25-year amortization period for mortgages.