A report from Ratehub.ca reveals that Canada's housing affordability for May 2023 is on track, with the Canadian Real Estate Association (CREA) and Ratehub experts stating that the housing market is on the road to post-pandemic recovery. In May, 54,241 homes were sold, marking the first year-over-year growth since June 2021. The earlier slowdown may be attributed to interest rate hikes from the Bank of Canada to cool inflation.
The national average home price has grown for the first time in 12 months, but remains lower than the February 2022 peak of $816,720. The average price increased by 3.2% in May to $729,044, according to Ratehub's analysis of major Canadian cities.
Ratehub reports that affordability has improved annually, with market conditions more comparable to last May's when the Bank of Canada's hiking cycle began. Major cities saw a drop in home buying requirements, with Halifax and Calgary being exceptions. Halifax requires $109,350 more than last year's requirement, while the average home price has dropped by $9,500.
Hamilton, Ontario experienced a significant drop in average home prices, resulting in a decrease in income needed to buy a home. Toronto's unaffordability remains, with an average home costing over a million ($1,164,400). Ottawa's average home costs $130,000 ($4,670) per year, while Montreal's prices dropped significantly ($32,100). Despite the drop in income needed to buy a home, Toronto's average home still remains unattainable.