Owning a home in Canada becoming more affordable

As per study conducted by Royal Bank of Canada, cost of owning a home as a percentage of the household income has registered fall for the fifth consecutive quarter.

This is indeed welcome news since the recession in the reality market for the past decade or so. This coupled with the falling interest rates, owning a house will be much more affordable for many families in Canada.

As per the findings released by the bank, the affordability measures have improved as follows-

- for a standard condominium, by 0.4 percentage points to 26.9 per cent.
- for detached bungalows, by 0.6 percentage points to 39.1 per cent.
- for standard townhouses, by 0.6 per cent to 31.5 per cent;
- for standard two-storey homes, by 0.6 per cent to 44.4 per cent.

As the affordability is measured as cost of ownership of a house as a percentage of the household income, the lower the measure the better it is.

This means owning a condominium is most affordable for Canadian families.

Steep drop in mortgage rates coupled with decline in cost of housing has significantly lowered the cost of homeownership, the Royal Bank said in its report.

However, while the improvement in affordability was widespread across the country in Vancouver's condominium sector, it rose marginally.

Consumers have responded by jumping back into the housing market. This may lead to slight hardening up of the prices however affordability is expected to remain attractive given the general improvement in economy.