{"id":19139,"date":"2022-01-03T10:10:00","date_gmt":"2022-01-03T18:10:00","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=19139"},"modified":"2021-12-21T10:10:42","modified_gmt":"2021-12-21T18:10:42","slug":"housing-affordability-looking-grim-going-into-2022","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2022\/01\/housing-affordability-looking-grim-going-into-2022\/","title":{"rendered":"Housing Affordability Looking &#8220;Grim&#8221; Going Into 2022"},"content":{"rendered":"<p style=\"text-align: justify;\">Housing affordability is looking \u201cgrim\u201d for homebuyers \u2014 especially those on the West Coast \u2013 going into 2022, according to a new report from economists at the Royal Bank of Canada (TSX:RY).<\/p>\n<p style=\"text-align: justify;\">\u201c[Metro Vancouver] still reigns supreme as Canada\u2019s least affordable market,\u201d Friday\u2019s report stated.<\/p>\n<p style=\"text-align: justify;\">RBC estimates the average household in the region must allocate 64.3% of income to cover homeownership costs, as of the third quarter of 2021. Only Toronto\u2019s proportion of household income \u2014 61.9% \u2014 comes close to rivalling Vancouver\u2019s.<\/p>\n<p style=\"text-align: justify;\">\u201cThe outlook for buyers is grim,\u201d the bank said in its Friday report, referring to the broader national trend of ownership costs accounting for 47.5% of household income on average.<\/p>\n<p style=\"text-align: justify;\">\u201cWe estimate rising interest rates alone could drive up our national affordability measure another 2-3.5 percentage points over the coming year. A further 5% increase in home prices would add an extra two percentage points.\u201d<\/p>\n<p style=\"text-align: justify;\">Victoria is Canada\u2019s third-least affordable market after Vancouver and Toronto.<\/p>\n<p style=\"text-align: justify;\">The bank estimates homeowners in the provincial capital must allocate 49.1% of household income to cover ownership costs.<\/p>\n<p style=\"text-align: justify;\">\u201cOwnership costs are poised to rise further in the near term as exceptionally tight demand-supply conditions force buyers to bid aggressively,\u201d the report said about Victoria.<\/p>\n<p style=\"text-align: justify;\">The bank said the lack of affordability is stemming from \u201csupercharged\u201d demand, while inventories sit at near-historic lows in virtually every market, \u201ccreating intense competition between buyers and [pressuring] prices up.<\/p>\n<p style=\"text-align: justify;\">\u201cThese conditions have widely eroded housing affordability in the past year.\u201d<\/p>\n<p style=\"text-align: justify;\">Prospective buyers will cope by either commuting significantly longer distances to land their preferred type of property or else scale down the type of property they\u2019re in the market for, according to RBC.<\/p>\n<p style=\"text-align: justify;\">\u201cBecause of already challenging conditions and the fact that rising interest rates will push up ownership costs more in Canada\u2019s priciest markets, we expect buyers in Vancouver, Toronto, Victoria and, to a lesser extent, Ottawa and Montreal to be under the most pressure to reset their expectations,\u201d the report stated.<\/p>\n<p style=\"text-align: justify;\"><a href=\"https:\/\/biv.com\/article\/2021\/12\/vancouver-victoria-homebuyers-under-most-pressure-reset-expectations-next-year\" target=\"_blank\" rel=\"noopener\">Vancouver, Victoria Homebuyers &#8220;Under The Most Pressure&#8221; to Reset Expectations Next Year<\/a> by Tyler Orton | BIV<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Housing affordability is looking \u201cgrim\u201d for homebuyers \u2014 especially those on the West Coast \u2013 going into 2022, according to a new report from economists at the Royal Bank of &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2022\/01\/housing-affordability-looking-grim-going-into-2022\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"class_list":["post-19139","post","type-post","status-publish","format-standard","hentry","category-market-updates"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Housing Affordability Looking &quot;Grim&quot; Going Into 2022 &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2022\/01\/housing-affordability-looking-grim-going-into-2022\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Housing Affordability Looking &quot;Grim&quot; 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