Even though Metro Vancouver’s real estate market has seen a significant slowdown recently, the affordability of both houses and condos has eroded, according to a study by National Bank of Canada.
The nationwide study found that a mortgage payment for a median-priced single-family home in the Vancouver Census Metropolitan Area – based on a set of parameters – was now 101.5 per cent of the region’s median household income. That’s up 2.7 percentage points over the previous quarter, a jump of 6.4 percentage points year over year, and the highest it has ever been.
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National Bank said this erosion of affordability was “on the back of rising interest rates and falling income growth,” as median single-family home prices were down 0.7 per cent quarter over quarter and up just 1.8 per cent year over year.
In the condo sector, affordability is also at its worst-ever level, according to National Bank. It found monthly mortgage costs on a median-priced condo in the Vancouver CMA now take up 49.2 per cent of the median household income, up 1.3 percentage points from the previous quarter and 6.3 percentage points year over year. That is the 14th consecutive quarterly deterioration in condo affordability in the region, said National Bank.