Housing affordability worsens again in 10 of 13 major Canadian cities, says Ratehub
Canada’s early-spring housing market shifted further out of reach for many borrowers in March, with new data showing mortgage affordability eroded in 10 of 13 major cities even as interest rates largely held steady.
According to Ratehub.ca’s latest home affordability report, modest price gains rather than rate moves pushed required incomes higher across much of the country.
“Our latest home affordability analysis found that the majority of the cities we looked at saw home affordability worsen. Ten cities saw affordability worsen, two cities saw improvement, and one saw no change,” Penelope Graham, mortgage expert at Ratehub.ca, said.
Halifax and Victoria led the deterioration. Halifax’s benchmark price climbed to $571,700 in March, up $13,100 from February, adding $61 to the typical monthly payment.
“Halifax saw the most significant increase with $2,270 in additional income required to purchase the average home,” Graham said.
Victoria’s benchmark rose $13,500 to $886,000, requiring $2,230 more in annual income and about $60 extra per month for new borrowers, she said.
Smaller Prairie and Atlantic markets also felt the pinch. Winnipeg buyers needed roughly $1,910 more in income after prices climbed to $394,600, while Regina’s benchmark reached $343,700, adding $1,250 to the qualifying income.
Edmonton, St. John’s and Calgary each saw required incomes rise by $600 to just over $1,000 as average prices pushed higher.
On the other hand, Fredericton was the lone market with meaningful relief. Its average price slipped to $357,700, cutting the income needed by $1,210 and trimming monthly payments by $32.
“This is a welcome change from last month when Fredericton saw home affordability worsen,” Graham said.
Hamilton posted only a marginal improvement, while Montreal saw effectively no change and remains stretched for many households.
Graham noted that March conditions might soon look benign.
“It’s worth noting that fixed mortgage rates have seen increases across different lenders over the last few weeks, and while the impact of this isn’t seen in March’s report, we will definitely see it materialize in April’s report,” she said.
For borrowers trying to preserve purchasing power as volatility returns, Graham pointed to the gap between posted bank rates and the most competitive offers.
“One of the best things you can do right now is look at current mortgage rates across the market – not just from your bank – to ensure you’re being offered competitive rates,” she said.
With the Bank of Canada holding its policy rate at 2.25% in March while warning it could hike again if energy-driven inflation persists, and the Canadian Real Estate Association flagging a slower-than-expected recovery through 2026, brokers may need to prepare clients for a spring where borrowing costs and qualifying hurdles both edge higher.
Source CMP
By Liezel Once
