Home affordability gets worse in first quarter as prices in Vancouver Toronto

OTTAWA — The Royal Bank says housing affordability in Canada worsened in the first quarter as the cost of ownership in Vancouver and Toronto increased.It says the higher cost of ownership in most other areas of Canada was modest relative to income.The bank says its aggregate affordability measure rose by 0.8 percentage points to 47.1 per cent in the first quarter, its fourth consecutive quarterly increase.Renovation spending expected to rise in 2016 as people just can’t afford to moveHousing crash in Canada could cost mortgage lenders almost $12 billion, Moody’s warnsThe measure is the proportion of median pre-tax household income required to pay the cost of mortgage payments, property taxes, and utilities based on the average market price.Royal Bank says the affordability of a single-detached home in Vancouver hit the worst recorded level for anywhere in Canada due to an “epic surge” in home prices.The bank’s affordability measure for a single-detached home climbed 9.9 percentage points to 119.5 per cent in Vancouver and 1.2 percentage points to 71.7 per cent in Toronto. read more