A recent report on Canadian housing affordability showed that mortgages on a representative home in Canada now take 63.9% annual income to service, which is the highest since 1982. In Toronto, Montreal, and Vancouver, monthly mortgage payments on non-condo homes were more than double the average monthly rent for a condo. The monthly mortgage payments were closer to the average monthly rent range in Calgary, Edmonton, Winnipeg, and Quebec City.
In the British Columbia context, Schilling said people want to live in the lower mainland, which is expensive to either rent or buy, so they’re moving into the Fraser Valley, or onto the Sunshine Coast, or further north to Squamish, where it is cheaper to buy homes than in downtown Vancouver.
“Buying a house is an investment, but it’s obviously much more than that,” he said. “We see lots of people changing their minds about whether they want to buy or where they will buy or rent.”
Given housing prices and climbing interest rates, younger people may still be borrowing from the bank of mom and dad, but also opting to rent for another year to see if interest rates will decrease.
“I don’t know if that’s because people are used to living in an ultra-low rate environment, but there’s a sense that people are wanting to sit out the storm,” said Schilling.
