November 29, 2010 - For the first time in a year, homeownership became more affordable across the country – including Montreal – says a Royal Bank of Canada report published Monday.
The relief for homeowners in the third quarter follows a period when Montreal’s housing market experienced the second-highest year-over-year increase in the cost of homeownership in the country after Vancouver, says the report by Canada’s largest bank.
But unlike Vancouver – where some analysts have raised concern about the risk of a real-estate bubble – Montreal’s housing prices are still more affordable than the national average.
During the third quarter of 2010, the average price of a condominium in Montreal was $223,700, compared with $309,900 in Toronto and $390,400 in Vancouver, says the Housing Trends and Affordability Report. But median household income in Montreal was just over $47,000, compared with $69,000 in Toronto and $61,000 in Vancouver.
The Quebec housing market is making its way towards more stable activity levels after plummeting to six-year lows at the end of 2008 and then surging to all-time highs at the start of 2010. Supporting this trend in the near term is an improvement in affordability in the third quarter. Following four consecutive increases, the RBC Measures for the province fell 1.4 to 1.8 percentage points depending on the housing type, but still remain close to the pre-downturn peaks and above their long-term average, which will likely restrain growth in demand in the period ahead.