The average Canadian is finding home buying very difficult, an RBC index shows. According to the RBC index, prices of homes are becoming less affordable and despite that many people are getting into what many view as an overpriced market.
According to the Royal Bank, the index for housing affordability was down in the second quarter this year in 2 of 3 categories that were measured. This means that Canadians on an average were paying more pre-tax income when it comes to servicing their homes as compared to the year’s first quarter, despite the fact that index is still low from a year ago.
It's good to note that the quarter increase was exactly that spectacular, for a detached bungalow there was a 0.3 points to 42,7% while for a standard two-storey home there was a 0.4 points to 48.4%. Condo’s index was unchanged at 27.9%.
Toronto as well as Vancouver have over the past few years known as least affordable cities and their maintained their status when it comes to affordability. For Vancouver, the affordability reading rose by 2.2 points to stand at 82.1 on detached bungalows, while or Toronto it rose by half a point to stand at 54.5.
When speaking about homes being less affordable, Craig Wright, RBC’s chief economist noted that prices bounced back.
“We saw a bit of a bounce-back in prices,” he said adding that, “We had a series of regulatory changes, but now it looks like the market has adjusted and now seems to be recovering somewhat.”