The standard home in Canada now costs twice as much as in the U.S.
Fortune: 'The pandemic boosted demand for larger living spaces, with the home becoming "people's workplace, children's schools, and [the center of] entertainment," says Phil Soper, president and CEO of Canadian real estate brokerage Royal LePage. At the same time, Canadian millennials entered their "prime property trading years"—buying their first homes or upgrading starter homes—while many baby boomers became empty nesters and searched for new properties to suit the next stage of their lives, Soper says.
'The surge in demand collided with a longstanding problem in Canada: too few houses. Out of the Group of Seven (G7) nations—the world's advanced economies—Canada has the lowest number of housing units per 1,000 residents. By early 2022, Canada's home prices and unaffordability had hit unprecedented levels.
'This February, Canada's average home price reached a record $816,720 CAD ($646,809), 50% above pre-pandemic levels and up 20% from one year prior—and more than nine times the average household income, according to the Canadian Real Estate Association. Over the past year, the percentage of monthly income households were spending on mortgages rose at its at the fastest clip in 26 years to now hover at nearly 50%, according to the National Bank of Canada (NBC). In Vancouver and Toronto, Canada's main business hubs, the typical household needs to save 10% of income for 431 months and 340 months, respectively, to make a down payment on a non-condo home, according to NBC calculations.'