Owning a home in Canada is the most affordable it’s been in three years, but Vancouver remains the priciest market by a mile, according to an economist at RBC (TSX:RY).
A June 26 report says that as of the first quarter of 2025, affordability has improved over five straight quarters in the Vancouver area.
Despite recent price reductions, it still requires 92.7 per cent of median household income to cover ownership costs in the region, said the report. That’s compared with 68.3 per cent for the next priciest Canadian market, Toronto.
“Despite material improvement, affordability remains worse than it was before the pandemic—substantially so in Vancouver and Victoria,” wrote report author Robert Hogue, RBC’s assistant chief economist.
The report said affordability is improving in both the condo and detached homes segments, though condos have seen “the most significant turnaround.”
“We expect prices to fall further near-term with supply-demand conditions tilted squarely in buyers’ favour,” said the report, citing slumping sales and trade-war worries.
Meanwhile, home prices remain elevated from pre-pandemic levels. On a national level, the report said improvements over five quarters have only reversed about a third of the spike during COVID-19.
Still, it’s a live question whether lower interest rates and home prices will boost sales, said the report.
“Whether this will spur potential buyers into action will depend on whether de-escalation of the trade war continues to boost confidence,” said the report.
