RBC’s most recent housing affordability survey was released yesterday and it should come as no surprise that Saskatoon and Saskatchewan once again received special attention showing some of the sharpest erosion of affordability when compared to other markets across Canada.
A quick look at the “mortgage carrying costs by city” charts appears to indicate that servicing a mortgage on a Saskatoon home requires a larger percentage of income than 15 of the 20 cities represented in the survey results. Ouch! Home owners in Victoria, Vancouver, Calgary, and Toronto pay a larger percentage of income. Though it’s tough to tell from these graphs, we may now be less affordable than Edmonton.
It’s also worth noting that these results represent changes to the end of the second quarter of 2007, and that Saskatoon continued to see some increases through the third quarter while other western markets experienced considerable cooling. I expect that we’ll see affordability deteriorate further in the next report, though likely not as significantly as we have over the last two.
Here are a few of the highlights from this report.
“Homeownership costs continued to climb steadily with Canada’s housing affordability sharply eroding across all four housing types in the second quarter, according to the latest Housing Affordability report released today by RBC Economics.”
The report goes on to say, “Saskatchewan, Alberta and British Columbia witnessed the most significant erosion in housing affordability. Affordability deteriorated by approximately 20 per cent across each of the home segments in Saskatchewan, marking the worst quarterly deterioration on record. Over the past couple of years, Saskatoon, Edmonton and Calgary have suffered the largest deteriorations of all Canadian cities.”
“Housing markets conditions from Manitoba eastward are not a cause for concern, but conditions in Saskatchewan, Alberta and British Columbia warrant caution given the speed of the massive turnaround in affordability in several key cities. The economic fundamentals are supportive, but have been priced in fairly aggressively. In our view, a continued cooling in the pace of price gains and an ongoing pull back in sales-to’ listings ratios lie in the cards in these cities.”
Read the RBC Housing Affordabilty report here
Read the overview specific to Saskatchewan
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