Canadian property bubbles have seen affordability creep past the world’s most influential cities. Oxford Economics released new North America Housing Affordability Indices (HAIs) for Q1 2021. The index measures housing affordability for the median household in various cities. They found Canada’s hottest real estate markets are now less affordable than globally influential US cities. Heck, Canada’s property bubble even pushed the tiny steel city of Hamilton to become less affordable than Los Angeles or New York City.
Vancouver, Toronto, and Hamilton Home Prices Are The Least Affordable
Canadian housing markets topped their list of least affordable markets in North America. Vancouver is the king of unaffordable housing, with a 1.67 HAI score, by far the highest. A relatively distant second is Toronto, with a 1.50 HAI score. Hamilton (?!) comes in third with a score of 1.50. No, this isn’t a Canada-specific list. It’s a comparison of all of North America. These 3 cities are just at the top of unaffordability.
New York City, and Los Angeles Housing Is Now More Affordable
World-renowned American cities, with notoriously expensive housing, fell behind Canadian cities. Los Angeles, for instance, came in as the fifth least affordable city on the list. Seattle came in 8th, with an HAI score nearly a third lower than Toronto or Vancouver. New York City, whose Greater Region has a GDP the size of all of Canada, was the 9th least affordable.
But wait, there’s more. Montreal home prices have been on fire, since home buyers figured it would be the next expensive city. It now ranks just behind New York City in terms of the lack of housing affordability. Miami, America’s latest tech super hub, is seeing explosive economic growth. It’s still more affordable than Montreal.
Quebec City Has The Most Affordable Housing In Canada
The top three most affordable cities did include one Canadian city. At least until investors read this paragraph. Chicago is the most affordable city in the list with an HAI score of 0.60. Columbus comes in second with a 0.62 index score. Quebec City’s HAI of 0.64 landed it in third. Give that until the end of the month in this speculative environment.
Worth mentioning that three other cities also made the top 10 most affordable. Edmonton and Calgary, Alberta’s two big cities, came in 6th and 10th, respectively. Winnipeg came in 8th. Yes, all of these are Prairie cities. It shouldn’t be a big surprise Canada’s national housing agency thinks Ontario and BC are past peak growth. The Prairies are now projected to outpace for population growth, partially due to affordability.
Skilled Millennials are going to have a really hard time deciding where to live. Do they go for the small Canadian city, largely known for its steel manufacturing? Or somewhere more affordable, like the global financial capital of New York City? Tough one.
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