The costs of owning a home rose across Canada in the second quarter, though levels are still within the safe range for the market, a survey by RBC found.
The RBC Housing Affordability Measure looks at how much of a household’s pre-tax income is needed to service the costs of owning a home. Owning a standard two-storey home saw the biggest increase in costs gaining 2.1 percentage points to 48.9%, while the cost of a detached bungalow was up 1.9 percentage point to 42.9%.
It was the fourth consecutive gain in the measure, which has now reversed about half of the improvements in housing affordability made in 2008 and 2009, RBC said.
A combination of higher interest rates and rising prices are putting the prospect of homeownership out of reach for an increasing number of people. That said, RBC noted that affordability levels in Canada remain within a safe range.
''Current levels of affordability suggest some greater-than-usual stress weighing on Canadian homebuyers, but this does not represent an imminent threat to the market,'' RBC senior economist Robert Hogue said. ''While we expect rising interest rates to increase mortgage servicing costs, a leveling off in home prices and increasing household income will partly offset the negative effect.''
The biggest deterioration in affordability was in Ontario and British Columbia. There was an improvement for condominium buyers in Alberta and townhouse buyers in Saskatchewan, though most other provinces saw costs rise.
