Canadians are having to work double the hours than the previous generation to afford a home according to an academic study. Professor Marc Lavoie of the Broadbent Institute analysed data from 1970 through 2016 and discovered that, at average rates, it now takes between 420 and 450 hours of working time to afford a home with a mortgage compared with 200 in the mid-1970s.
Lavoie’s study shows that in the late 1980’s and early 1990’s it was also very expensive to buy a home but that was during a housing peak when Canada’s interest rates soared to tackle inflation. Even in 2000 the required hours’ work to afford a home was 300, around a third lower than today.
Lavoie is calling for more government assistance on home affordability as he says low
mortgage rates do not fully compensate for the high prices.
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate
More market watch: