For the second-straight quarter the cost of owning a home in Canada has gone up, according to the latest housing trends report from the Royal Bank.

In its report released Monday, RBC said a modest bump in home prices and mortgage rates made home ownership more expensive.

The decrease was led by the declining affordability of two-storey homes and detached bungalows, while condominiums held steady.

Across the country, Vancouver continues to hover near record levels as the least affordable housing market.

Real estate in the Vancouver-area is so expensive, the report says that the market there is exaggerating the national numbers.

"This is particularly the case for detached bungalows, where the margin above the historical average in the second quarter (3.9 percentage points) would be cut by half if it were to exclude Vancouver from the national tally," the report notes.

The relative cost of home ownership in Toronto is up too, off peak levels reached during the 1980s but still above their historical average.

Saskatchewan, Manitoba and Atlantic Canada also saw worsened affordability, while Montreal and Alberta stood out against the trend.

In major cities across the country, RBC calculates its latest Housing Affordability Measure as:

  • Vancouver 91 per cent (up 2.2)
  • Toronto 54.5 (up 0.9)
  • Ottawa 41.9 (unchanged)
  • Montreal 40.4 (down 1)
  • Calgary 36.7 (unchanged)
  • Edmonton 32.4 (down 0.1)

RBC's benchmark Housing Affordability Measure is based on the costs of owning a detached bungalow at market value.

The higher the number -- which accounts for such expenses as mortgage payments, utilities and property taxes as a percentage of household pre-tax income -- the more expensive it is to own a home.

In its report, RBC notes that the two consecutive quarters of declining affordability this year follow two back-to-back quarters at the end of 2011 in which affordability increased.

In an interview with CTV News Channel, RBC Senior Economist Robert Hogue said, "On a year-over year basis we can still be talking about home price increases, but we're seeing that the momentum has slowed considerably and that market conditions have softened up in certain markets -- Vancouver in particular."

Looking ahead, the RBC report says the cooling in Canada's housing market during Q2 will likely continue in light of new rules for government-backed mortgages and "prospects for further erosion in affordability."

The report points to rising interest rates as one possible factor, suggesting that, should the Bank of Canada begin normalizing interest rates as expected next year, "affordability-related pressures, therefore, could well intensify."