Canadian housing affordability continues to improve, but it remains far from affordable. National Bank Financial’s (NBF) Housing Affordability Index improved in Q2 2026. The bank’s data shows a record-long streak of improvements hasn’t put any markets within reach. Buying a typical home requires a household income nearly double the median, rising to over a quarter-million in the most expensive market.
Canadian Housing Affordability Improves As Prices Fall
The bank’s data shows housing affordability improved for a tenth consecutive quarter. Falling home prices drove the improvements across the C10, an index of the ten largest cities. The price of a typical home in the index fell 2.1% to $761,179 in Q2 2026, down 4.6% from last year. This helped lower monthly mortgage payments, but they would still be a stretch for most.
With a traditional down payment (20%), the bank estimates mortgage payments would be $4,089/month. That works out to 51.1% of the income of a median household, 10.4 points above the 40.7% average since 2000. To actually qualify for that mortgage, the minimum household income is now $175,317. A median household only needs an 81.5% pay bump and the market should be booming any day now.
Toronto and Vancouver Affordability Improves, But Not Enough
The estimated share of income a median household needs to carry the mortgage on a typical home vs the historical average.
Source: NBF; Better Dwelling.
Canada’s largest and most expensive housing markets have made big improvements. The priciest market is still Greater Vancouver, where home prices fell 2.9% to $1,174,406 in Q2, down 6.9% from last year. This helped lower the estimated mortgage payment to 79.4% of the median income in the region. That’s 2.6 points lower than last quarter and 8.7 points below last year, but the median household wouldn’t qualify. With 20% down, a minimum qualifying income of $265,618 is needed to make that work, 179% more than the median.
Home prices in the Greater Toronto region continue to fall more aggressively, trimming 3.6% to $1,043,885 in Q2. This brings the monthly payment down to 68.3% of the median income, 2.5 points lower q/q and 7.8 points from last year. That brings the minimum qualifying income to $236,780, about 140% higher than the region’s median.
Canada’s Traditionally Affordable Markets Continue To Erode
The estimated qualifying income for a typical home vs the median household income in Canada’s ten largest markets.
Source: NBF; Better Dwelling.
Canada no longer has any major cities affordable for the median household. Prices in Quebec City made the biggest jump in Q2, requiring 38.5% of the median income for payments. That’s a long way from the 24.2% average since 2000. A typical home now requires a minimum qualifying annual income of $116,732, 39% higher than the current median.
Winnipeg is the other city in the C10 to see prices rise in Q2, pushing estimated mortgage payments to 33.5% of income. That’s 0.9 points higher than the last quarter, and 7.2 points above the 26.3% average since 2000. The bank estimates this requires a household income of $103,469, about 23.8% above the median. Winnipeg’s move was just enough that households need at least 6-figures in every city to buy a typical home. Darn avocado toast.
Canadian real estate markets are stalling after a price correction in major markets. However, prices still remain deeply unaffordable for the majority of incomes. A problem made even more complicated by the fact that those looking to get into the market are younger households who tend to be earlier in their career. It’s hard to move up the property ladder if there are no rungs within reach, creating upstream liquidity issues in the future.
