Royal Bank says B.C.'s housing affordability deteriorating faster than other provinces
The Royal Bank of Canada reported that home-ownership costs rose for the third consecutive quarter, with B.C.'s increase outpacing all other provinces.
In a report released today (May 25), RBC Economics stated that its affordability index of housing in B.C. has come close to the all-time high recorded in 2008.
RBC's housing affordability measure identifies the percentage of pre-tax family income required to finance a home.
For a detached bungalow in B.C, it requires 66 percent of pretax family income for the average household. A townhouse would need 49.5 percent of pretax family income, whereas a condo comes in at 35.5 percent, according to RBC Economics.
A two-storey home requires 73 percent of pretax family income, up 3.2 percent over the last quarter.
Housing affordability deteriorated in all provinces except Alberta.
Follow Charlie Smith on Twitter at twitter.com/csmithstraight.
Comments
2 Comments
You Don't Say
May 25, 2010 at 8:10pm
And couple that with the average debt load the average family has incurred and it makes you wonder what Government's strategy was when getting the market to bubble during a recession. I realize investors may be happy and banks as CEO's boast of record investments in foreign markets. All the while Canadians are tightening their belts which isn't going to be to difficult for the average Joe trying to pay off his mortgage and car and renovations leaving little for anything else like staples. Something will have to give as cash strapped Vancouver'tes got no money to party now. The Banks say no worry be happy but all that bad debt Banks incurred and they did who is picking that up? Someone has to, and its the taxpayer that is and then the Average Joe is going to even go further and reward the same culpurits. How does that affect the average mortgage as interest rate climb with the inflation factor being the motivator or stagflation in BC because no body has any cash as prices continue to climb.
Kevin
May 27, 2010 at 11:38am
A strange thing happened to me. I was looking at my CIBC line of credit and I noticed that I was given an extra $5,000 without requesting it. I called CIBC and they could not understand what the problem was. I told them that my goal was to reduce my debt levels and not incurr more. They even had the nerve to ask me why I had paid off a recent $5000 loan! How many people would have just spent the the extra money?