A just released report by RBC says the housing affordability situation across Canada has never been worse and it’s hitting Victorians where it hurts most: their wallets.
Interest rates continue to rise as the Bank of Canada battles inflation, but that means home ownership costs are through the roof.
Since March, as rates soar, RBC says its “aggregate affordability measure” has hit 62.7%. which is the worst thing that has happened.
In every home ownership market in Canada that RBC monitors, costs have gotten worse.
The bank predicts that the nadir of the affordability crisis is likely to be near. The price decline should be widespread throughout BC and will help stabilize markets.
According to RBC, benchmark prices should fall 14% across the country by next spring’s peak.
“To qualify for a home appraised at the reference price, buyers in Victoria must have six-figure pre-tax income,” RBC said in a press release.
In precise numbers, Victorians must earn at least $216,000 pre-tax per year to qualify for a benchmark home mortgage.
“It has never been so unaffordable to buy a home in this country,” the bank said.
Home resales have plummeted 43% in BC due to worsening affordability conditions plaguing the market.
Looking ahead, RBC predicts the end is in sight, but we’re not there yet.
“Affordability issues are not likely to be reversed quickly. It will take longer for the market to absorb the increase in mortgage rates,” RBC said.
“We expect the market to bottom out around spring.”