Improvement of affordability
Craig Lord, the Canadian press – October 2, 2025 / 8:12 a.m. | History: 575694
Photo: The Canadian press
The parliamentary budget officer says that the affordability has been limited since 2022, but some households in expensive housing markets are still financially susceptible. New single-family houses that are attached under construction as real estate and town houses can be seen on Monday, August 12, 2024, Delta, BC.
Since the parliamentarians save on how living becomes more affordable, Ottawa's fiscal watchdog reports considerable progress in the end of this affordability nationwide – but the picture looks very different across the country.
Jason Jacques, the preliminary parliament's budget representative, published an updated apartment report on Thursday. The report measures the affordability based on the gap between the average real estate prices and the typical household.
This gap was narrowed from 80 percent in September 2023 to 34 percent in August, the report said.
The PBO said that cheaper credit costs, stronger wages and lower real estate prices make it easier for the Canadian to afford a house and pay their mortgage.
Real estate prices reached its peak in 2022 during the Pandemie recreation period, but then cooled down in many markets after the Canada of the Bank of Canada quickly increased its benchmark interest rate to over five percent.
Today, according to a number of cuts, the political interest rate is 2.5 percent, which contributes to reducing the mortgage costs. Real estate prices have not returned to previous heights.
According to Canada's most expensive markets in the past three years, the greatest affordability gains have been achieved in the past three years.
The most important improvements were found in Toronto and Hamilton, but the PBO found that real estate prices in these markets are still far above the affordable level.
With 74 percent, the affordability gap in Halifax is greatest, while Edmonton's four percent gap is the smallest of all large metropolese contained in the analysis.
Calgary, Montreal and Québec gathered the most affordable, but the PBO said that the cost of carrying a mortgage in these cities were still relatively low.
The report also measured the financial stability of households based on the conditions of the mortgage debt service – the proportion of household income that runs for paying a housing loan.
In the first half of 2025, when the housing record was restored to the affordability of living space, in 2019, the PBO said.
While these conditions have improved in Toronto, Vancouver and Victoria, the PBO warned households in these even more expensive markets financially than the others in Canada.