Vancouver ranks as the least affordable city for homeownership in Canada and is the fourth least-affordable globally, a recently released report on housing costs suggests.
The international report, conducted by the Center for Demographics and Policy at Chapman University in California and published by the Frontier Centre for Public Policy, studied housing costs in the third quarter of 2024 in major cities across eight nations. It found that the least affordable market was Hong Kong, followed by Sydney, San Jose, and Vancouver.
Toronto was also highlighted in the report as being among the cities with the least affordable housing. While Canada’s largest city didn’t make the top 10 list of the most unaffordable cities in the world to live in, it wasn’t far off. Of the 95 major housing markets analyzed, Toronto was identified as the 12th least affordable.
The 95 markets analyzed were in eight countries: Australia, Canada, China, Ireland, New Zealand, Singapore, the United Kingdom, and the United States.
An affordability ratio was given to each market by using the “median multiple,” the ratio of median house prices to gross median household income. A ratio of 3.0 or less is considered affordable, while cities with a ranking of 5.1 to 8.9 are labelled as “severely unaffordable,” and a score of 9.0 or more is “impossibly unaffordable.”
The national median multiple for Canada was recorded at 5.4.
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Vancouver received a score of 11.8, making it “impossibly unaffordable” while Toronto was rated 8.4 and Montreal was rated 5.8, classifying them both as “severely unaffordable.”
Ottawa received a score of 5.0 and Calgary 4.8, to put them in the “seriously unaffordable” range. Only Edmonton, which came in at 3.7, was considered “moderately unaffordable.”
The price of housing in Canada’s major cities is also impacting surrounding communities as residents of metro areas seek lower costs of living outside the largest urban areas, the report said. Housing markets in the vicinity of Vancouver—Chilliwack, the Fraser Valley, Kelowna, and markets on Vancouver Island, for instance—have become significantly less affordable since 2015.
The same is true of the Toronto area, as residents relocate to cities like Kitchener-Cambridge-Waterloo, Brantford, London, and Guelph.
The findings of the report indicate a strong correlation between housing unaffordability and land-use policies such as greenbelts, urban growth boundaries, and densification requirements, especially in British Columbia and Ontario.
“What was once a nation of middle-class homeowners is becoming a country where homeownership is out of reach for the average family,” report author Wendell Cox said in a press release. “The evidence shows a direct link between restrictive land-use policies and skyrocketing housing prices.”
Canada’s major metropolitan regions saw a net decrease of approximately 275,000 domestic migrants from 2019 to 2023, whereas smaller markets experienced population growth—a phenomenon referred to in the report as “counter urbanization.” But this won’t be enough to tackle the high demand for more affordable housing, the report noted.
“Densification alone won’t solve the crisis,” the author wrote. “Canada needs more housing where people want to live—including detached homes at the urban fringe.”
Carolina Avendano contributed to this report.
