Skip to main content

2 Canadian cities ranked high on global list of most expensive places to buy a home

Share

As Canadians continue to struggle with the extremely high cost of buying a home in some of the country’s major urban centres, a new global report is underscoring just how expensive some of those markets are.

A study by Demographia, which examines international housing affordability, has deemed Vancouver and Toronto as “impossibly unaffordable."

David MacDonald, a senior economist with the Canadian Centre for Policy Alternatives, says the findings of the study aren't surprising.

“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,” he said.

The report analyzed middle-income affordability across 94 major markets in eight countries, including Canada, China, Ireland, Australia, New Zealand, Singapore, the United States and the United Kingdom. Each city is ranked based on its median multiple score which is determined by dividing the average house price in a city by its gross median household income.

A score under three is considered “affordable”, a score between 3.1 to four is considered “moderately unaffordable”, a score between 4.1 to five is considered “seriously unaffordable,” a score between 5.1 to 8.9 is considered “severely unaffordable” and this year, a new category of “impossibly unaffordable” was added for cities scoring nine or higher.

Toronto scored 9.3 and ranks 11th on the housing unaffordability list and Vancouver scored 12.3 and ranks third on the list.

“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,” said Aman Fiseha, a Vancouver resident.

A housing shortage is driving up the price of a home in Canada.

The Canada Mortgage and Housing Corporation says an extra 3.5 million homes need to be built to restore affordability by 2030.

In April, the Federal government announced billions in spending.

However, for people like Fiseha, it might be too late.

“We have considered potentially looking at opportunities in the United States," he said.

The report highlights housing costs outpacing income growth as the main cause of the crisis in the countries studied.

In Canada, Edmonton is the cheapest market to buy a home and labelled as “moderately unaffordable,” with a score of 3.6.

Calgary is listed as “seriously unaffordable” with a score of 4.6 and Ottawa and Montreal are considered “severely unaffordable,” with scores of 5.3 and 5.8 respectively.

Tom Storey, a Sales Representative with Royal Lepage Signature Realty, says people need to be a bit more creative to get into the housing market.

“Some people that are under rent control and have really good living conditions, what they're doing is actually buying an investment property as their first properties that they can get into the market. They're teaming up with their friends and family to co-buy properties and actually get it,” he said.

Nearly 90 per cent of the cities in the study did not fall into the highest rank of “impossibly unaffordable,” but none of the 94 cities scored below three, the cut off to be deemed “affordable." 

Here are the top 11 least affordable cities to buy a house based on median multiple score:

  1. Hong Kong, China, 16.7
  2. Sydney, Australia, 13.8
  3. Vancouver, B.C., 12.3
  4. San Jose, Calif., 11.9
  5. Los Angeles, Calif., 10.9
  6. Honolulu, Hawaii, 10.5
  7. Melbourne, Australia, 9.8
  8. San Fransisco, Calif., 9.7
  9. Adelaide, Australia, 9.7
  10. San Diego, Calif., 9.5
  11. Toronto, Ont., 9.3

CTVNews.ca Top Stories

These Picassos prompted a gender war at an Australian gallery. Now the curator says she painted them

They were billed as artworks by Pablo Picasso, paintings so valuable that an Australian art museum’s decision to display them in an exhibition restricted to women visitors provoked a gender discrimination lawsuit. The paintings again prompted international headlines when the gallery re-hung them in a women’s restroom to sidestep a legal ruling that said men could not be barred from viewing them.

Ben Affleck and Jennifer Lopez publicly list their house for sale

Ben Affleck and Jennifer Lopez have added a tiny bit of fuel to the fire surrounding their marriage. Amid speculation that the pair are struggling in their relationship after marrying about two years ago, the couple has listed their 12-bedroom, 24-bathroom California home for sale.

Local Spotlight

Stay Connected