While Canadian home sales have noticeably slowed down since the peaks seen this spring, overall activity continues to be historically strong, according to RBC Economics.

A major driver of the moderation in sales is the lack of inventory, especially in the largest markets.

“Tight demand-supply conditions will maintain support for prices in the near term,” RBC said in its latest Canadian Housing Health Check report. “Despite rock-bottom interest rates, home ownership costs have spiked across much of the country. The lack of affordability is severe in Vancouver and Toronto, and becoming more problematic in Montreal.”

RBC said that the sales-to-new listings ratio “is still close to a record high nationwide.”

“This tilts the scale decidedly in favour of sellers,” RBC said. “The central issue in most local markets is a lack of supply.”

The trend towards lower prices during the first few months of the pandemic has all but disappeared, as well.

“Soaring prices more than reversed the affordability improvement earlier in the pandemic,” RBC said, adding that its aggregate housing affordability measure increased to 52% in Q1 2021, a reading that it deemed the worst level in 31 years.

“A sharp rise in household income and drop in mortgage rates led to a modest improvement in RBC’s measure during the early stages of the pandemic,” the bank said. “However, rapidly appreciating prices in most parts of the country have since fully reversed the improvement. Further deterioration is expected in the period ahead.”

However, the possibility of future Bank of Canada interventions is introducing some uncertainty.

“Rock-bottom interest rates are a huge driver of housing demand but rates could rise if the economy outperforms expectations,” RBC said. “Generational-low interest rates have provided a powerful tailwind for the housing market since the summer of 2020. Any material rate increase could easily swing the wind direction.”

Another disruptive factor could emerge in the form of post-election policy adjustments.

“The recent tightening of mortgage lending criteria has strengthened household resilience,” RBC said. “With all federal parties proposing changes to housing policies, the next federal government is likely to introduce additional measures, the impact of which is unknown.”

While the housing market saw a relative pause in March, in recent weeks data has shown a surge in home sales outside the city. Many of the area’s buyers have been choosing to go beyond the traditional bedroom communities in the 905. The boom has been caused, in part, by the flexibility afforded to those working from home.

“(In) the top seven municipalities that saw the biggest growth, sales are up 40 per cent over last year, over the past six weeks,” said John Pasalis of Realosophy Realty.

The areas of those sales, he said, were on average about 86 kilometres away from Toronto.

Pasalis said the early signs of urban exodus were being driven by those who had a person working from home while their partner also had a flexible work status.

Durham Region and other areas within a close drive to Toronto have been an affordable alternative for many in the past, but Pasalis said areas seeing sales growth were far outside those areas.

“Areas like Caledon, Innisfil, King, like, just these outer, outer suburbs that are kind of not even the typical 905 — like Markham, Richmond Hill,” he said.

Jeff McKay and his wife Breanne Drennan have been dipping their toe in the rural market for the past several months. When the coronavirus pandemic hit, they were living in a two-bedroom apartment near Dufferin Street and St. Clair Avenue West. With two children and McKay working from home, the lack of space proved too much for their family.

McKay works for an insurance startup, which he said was set up so that remote work made a lot of sense. When the community workspace on Front Street shut down during the pandemic, he said the two-bedroom they were living in for commuting’s sake no longer made sense.

“We kind of looked at ourselves, at each other, and we were wondering, ‘Why are we in Toronto?’” said McKay.

“We were losing our minds,” said Drennan.

“We never expected to all hunker in and have a workspace and a household in a two-bedroom apartment.”

Drennan said they were among the lucky ones because her maternity leave gave her the ability to spend more time watching their sons, who are five and 18 months old. But with McKay’s ability to work from home, the pair decided to make a major change.

Now the family is living outside of Flesherton, located about a 40-minute drive southwest of Collingwood. With so much uncertainty surrounding the pandemic, they decided to lease rather than buy. But with their $1,500 rent on a modest home on a one-acre property versus $2,400 for a 1,000-square-foot apartment, the couple is considering a more permanent move.

“Something that seemed impossible before now seems like, you know, it can work,” said McKay.

“It’s kind of a decision that’s dynamic and it’s changing, you know, as the situation changes with COVID.”

Pasalis said many others aren’t playing it quite as safe when it comes to choosing more home and space over larger debts.

“I guess they’re confident that this is going to go on for years and I guess that’s the big bet that they’re making,” he said.

But while there has been a boom in some regions, he said the traditionally low sales volumes in those areas also need to be recognized. The test, Pasalis said, will be to see how long the trend continues.

“I think it’s hard to say how long these trends will last, but we’re certainly seeing these early signs of people moving to the suburbs,” he said.

Progressively tighter market conditions and sustained buyer competition have impelled double-digit annual price increases in the Toronto market, according to the region’s real estate board.

The benchmark price in the market was up by 17.4% annually in August, while the average selling price across all residential asset classes grew by 12.6% during the same period to reach roughly $1.071 million.

A total of 8,596 sales took place in the region, moderating by 19.9% annually. The number of new listings also declined by 43% year over year.

“While the market has taken its regular summer breather, it is clear that the demand for ownership housing remains strong. At the same time, the supply of listings is down,” the Toronto Regional Real Estate Board said in its latest report.

The TRREB expressed grave concern over the volume of new listings, which were at their lowest level for the past decade or so.

“It is clear that the supply of homes is not keeping pace with demand, and this situation will become worse once immigration into Canada resumes,” said Kevin Crigger, president of the TRREB.

John DiMichele, CEO of TRREB, said that the trends merit concrete policy action by those who would eventually take the reins of government.

“With a federal election just weeks away, we are calling on all political parties to continue focusing on housing policies that address supply and affordability across the country,” DiMichele said. “Bold action, not promises, are needed to ensure that Canada has a stable and sustainable housing market now, and in the decades to come. This will ensure that the Greater Golden Horseshoe remains competitive on the global stage, in terms of attracting businesses and households to the region.”

“Working with provincial and municipal levels of government on solving supply-related issues is much more important to affordability than interfering with consumer choice during the home buying and selling offer process or revisiting demand-side policies that will at best have a short-term impact on market conditions,” Crigger added.

While most residents in Toronto have renounced their dreams of ever owning a home in the region due to its infamously overvalued real estate market, there are still the fortunate few among us who can afford not just one, but multiple properties in the GTA.

And, a new report from Royal LePage shows that, quite shockingly, a larger proportion of these owners are 35 and under than over the age of 35, somehow.

The real estate giant surveyed Canadians in and around the urban centres of Toronto, Montreal and Vancouver to learn more about secondary properties, the people who own them and how they use them.

Among the findings are the fact that most people who have more than one residence in Canada rent out the homes they’re not living in at least some of the time — 64 per cent of secondary property owners in the GTA specifically — while only a small portion (seven per cent in Toronto) leave them vacant as simply an investment to sit on.

The most surprising tidbit in all of the data is perhaps the fact that while only 11 per cent of homeowners over 35 surveyed said they owned more than one property, 18 per cent of those 35 and under did.

“Witnessing home values across the country rising to new heights, younger Canadians who are financially able to purchase one home are confident in purchasing a secondary property as an investment,” the report reads.

“Young buyers are looking to capitalize on the real estate market by investing in a property that will appreciate over time.”

Also revelatory is the fact that a fair chunk of boomers —29 per cent in the GTA — have or would loan or straight up give their children money to help them buy a home in the region.

And, as we all well know, boomers are obsessed with the idea of getting a foot in the door of the real estate world: 93 per cent of Toronto boomers surveyed said they consider home ownership to be “a good financial investment.”

A sales representative for Royal LePage noted that in recent years, many young people have been able to nab condos and small homes for quite cheap in suburbs a bit farther out of the city proper, such as London and Guelph, which have great potential as rentals for students.

“Parents of students in Ontario’s university towns are also taking advantage of the local rental market, purchasing a property — often times with multiple units — for their children to stay in while studying and also as a source of rental income from other students,” she added.

So though more millennials and Gen Zers in the Toronto area may technically have their name on the deeds of more than one property than their older counterparts, little real estate tycoons that they are, the money funding said properties is oftentimes coming from some wealthy boomer benefactors, whether here or overseas.

But, with economic reopening now in full swing and travel and immigration poised to return in the next few weeks, things have been heating back up again, especially for certain types of units.

The market for new condos (and three-bedroom units) in particular has been for the most part quite busy thus far in 2021 despite some people giving up on the idea of home ownership in the city, with new unit sales outpacing both that of resale units and new houses.

In June, GTA condo prices rose to hit 44 per cent more than they were during the 2017 housing peak — the biggest jump for any housing type — and were expected at that time to spike another $275,000, on average, in the next two years.

And contrary to some inconsistent numbers from the first quarter of the year, it appears that Q2 2021 was even stronger for new condo sales in the region.

According to the latest report from the condo experts at Urbanation, sales in the sector were 5.5 times higher than during the first quarter of the year, indicating a full COVID-19 recovery.

Of nearly 8,500 presale units that hit the GTA market between April and June, 81 per cent were purchased, setting a record high. The average price for these units also hit $728,160 or a whopping $1,100 per square foot, regardless of size.

(In Toronto proper, as of Q2, the average condo will of course set you back far more; around $834,504 or $1,276 psf.)

Another notable figure is the amount of new condo inventory that was left unsold by the end of June: only 10 per cent, which set an 11-quarter low and was a staggering 23 per cent below the 10-year average, making it clear that the demand for new condo builds is extremely high and very contrary to what was going on at the end of 2020.

This is even considering the fact that there were a record high number of new condos being constructed, making for a whopping 86,346 units plus an additional 22,857 in the pre-construction stage.

On the resale condo market, both transactions and the absorption rate (number of units sold vs. number listed) were also up drastically from last year, which was to be expected given hesitancy spurred by the health crisis at that time.

The average price for a resale unit in the GTA hit a new record peak of $707,000 for all unit types, with Toronto obviously leading the way at $740,000 or $930 per square foot, on average, for a lived-in condo.

“The second quarter showed that the GTA new condominium market not only fully recovered from COVID-19 but also returned to near record high sales volumes,” the report reads.

“The 905 continued to be a driving force as developers and buyers have shifted to more affordable locations of the region. With inventory approaching a three-year low, expect further upward pressure on new condo prices in the near-term.”

Any prospective homeowners who weren’t in a position to get into the market when there were still some bargains to be had can expect prices and competition to surge even more once immigration levels return to normal, but can always set their sights on other, farther away parts of southern Ontario, like those where one can still nab a home for less than $250,000.

Real Mortgage Interest Rates
Real mortgage interest is the rate of interest paid, minus the annual rate of inflation. Mortgage debt with a 2% interest rate in an environment where inflation is 2% is a real rate of 0%. If inflation holds steady the lender is giving you money, returned with no real profit. They can buy the exact same amount of goods when they’re paid as they can before they lent the money. It’s essentially a free loan. Generous people, eh?

It doesn’t happen very often, but it’s happening right now in Canada.

Real Mortgage Interest Rates Haven’t Been This Low Since The 1970s
Canadian mortgage debt is being lent out at less than the current rate of inflation. Generally, the most popular type of mortgage is the 5-year fixed rate term, so let’s peep that. The posted 5-year fixed rate was 4.79% in June, working out to 1.7% after inflation. That’s still a positive number, and would be a big profit margin. Healthy and booming market, right? Just one problem — no one pays the posted mortgage rate.

Most analysis is done on the posted 5-year fixed rate, which is often used to set policy. Lenders rarely charge that rate, and its primary use is to calculate penalties. The best available rate is typically 220 to 250 bps lower than the posted rate. A 5-year fixed rate actually looks more like the prime lending rate, often a few points lower. So let’s look at the prime lending rate now to get a better perspective.

The prime lending rate for mortgages is much lower than the posted rate. It was 2.45% in June, which is 234 bps lower than the posted 5-year fixed rate. When adjusted for inflation, the real rate is -0.6% for June. A small improvement over the -1.2% seen in May, but still — it’s a negative number. A fairly big one when we’re talking about billions of dollars as well. They’re lending for cheaper than the current rate of inflation.

Canadian Medium-Term Mortgage Rate
The Canadian prime mortgage rate, which closely resembles the typical 5-year fixed mortgage rate. In both nominal and real (inflation-adjusted) values.

Canada hasn’t seen this kind of deep discount in generations. The -1.2% real rate is the lowest seen since the late 1970s, when there was an inflation crisis. This led to everyone buying homes at massive premiums as “inflation hedges.” That created a bubble, which popped in the early 1980s, and many tears were shed. A mispriced asset is often repriced to a more fair value once the reason for the mispricing ends.

Canadian Mortgage Debt With Little Rate Protection Is Soaring
Low interest rates have pushed more conventional mortgage dollar volumes to variable rates. Long-term variable rate data isn’t available, but 1-year fixed rate data is pretty close. It is just 5 bps apart from the 3-year variable term, so they’ll give us a pretty close view.

Conventional mortgages with a 1-year fixed rate of interest came in at 2.79% this past June. After adjusting for inflation, the rate is -0.3% in real terms. Short-term mortgages in Canada have never been this cheap. Like, ever.

Canadian Short-Term Mortgage Rate
The Canadian 1-year fixed mortgage rate at nominal and real (inflation-adjusted) values.

Does This Mean I Should Borrow As Much As I Can?
I know, you’re wondering if that means you should blow your brains out with debt right now. If you’re renewing your mortgage, ask your mortgage broker — it might be like you just won the lottery. If you’re buying property, the answer isn’t so clear and it’s kind of a gamble.

In normal circumstances, the assumption is inflation will be stable over time. That’s not what central banks are saying. In fact, they are outright saying inflation will not be this high. A negative real rate today may not be one next year. In this case, the lenders are likely banking on a drop in inflation. This would allow them to support lending lower than the current rate.

The term length is also something else to consider. In the US, with the world’s most liquid currency, mortgage rates can be guaranteed for the life of the mortgage. No surprises if inflation gets out of control, and the state needs to stop suppressing rates. You already agreed for 30 years what you’ll pay.

In Canada, you’re paying a hefty premium for anything longer than 5 years. That leaves most playing rate roulette on the balance of their mortgage on renewal. Defaulting isn’t so much of a concern since these borrowers will be stress tested. However, appreciation of the home is likely to slow (or correct) in the event of higher rates.

What does this tell us? It shows evidence of the housing market’s massive inefficiency, right down to financing. The real rate of interest is below zero, as if they needed to stimulate more borrowing. This is during a multi-decade high for credit growth… while home sales are just under the record high, and prices are growing at the fastest rate in history.

TRREB released its initial forecast for 2021 at the beginning of February in conjunction with its annual Market Year in Review and Outlook report. The outlook for 2021 called for 105,000 transactions with an average selling price of $1,025,000.

The board says this forecast was released as the regional economy continued to improve, and very low borrowing costs were anticipated to continue to fuel strong demand — though this demand was expected to slow during the year due to stalled population growth.

Although the board says sales have peaked for 2021, first-quarter activity was higher than expected, after March home sales, at more than 15,000, represented an all-time monthly record.

Considering the record Q1-2021 sales result, TRREB has revised its 2021 sales forecast and anticipates the year will end with 115,000 transactions — 10,000 more than it originally forecast. With year-over-year sales growth continuing to outpace new listings growth, the forecast average selling price has also been revised upward to $1,070,000, a $45,000 increase.

“ Home sales soared at the start of the year, with a huge sales record in the first quarter. However, the record pace of sales has run its course as pent-up demand has increasingly been satisfied in the absence of normal population growth,” said TRREB Chief Market Analyst Jason Mercer.

“With this said, a persistent lack of inventory across most segments of the market will keep competition between buyers strong, resulting in an average selling price well above $1 million through the end of 2021,” said Mercer.

TRREB’s revised market update comes as new public opinion polling, conducted by Ipsos Public Affairs for TRREB, found public opposition to a potential increase in Toronto’s Municipal Land Transfer Tax (MLTT).

Last winter, City of Toronto Council directed City staff to report back in July regarding a possible increase to the land transfer tax for properties priced over $2 million.

“Any MLTT increase has a ripple effect on all market segments, and would further constrain inventory, making it an even more challenging environment for buyers. Recent polling by Ipsos shows a majority of residents understand this risk and more than half oppose a potential increase to the land transfer tax. Housing affordability is one of Toronto’s most serious challenges and City Council should be doing everything it can to make it more affordable, not less,” said TRREB CEO John DiMichele.

The board has previously said it had concerns about the potential tax increase. As DiMichele reiterated, not only could it further constrain the supply of homes for sale in Toronto, but it could also exacerbate housing supply and affordability challenges, especially for those purchasing modest homes.

The poll found more than half (54%) of respondents are against this potential MLTT hike, while 63% said they believe the increase could result in a tighter supply of homes for sale across all price points.

Additionally, the new forecast comes as Toronto moves towards implementing a tax on vacant homes, excluding principal residences. TRREB says it has worked closely with City staff, calling for evidence-based decision-making to ensure that the tax meets its policy objectives of improving rental housing supply and ensuring that appropriate exemptions are provided.

“We appreciated the opportunity for input, and we are encouraged that the recommended tax design is consistent with TRREB’s views, especially the need for various exemptions,” said DiMichele.

“TRREB is generally supportive of the list of exemptions included in the staff recommendations, and we look forward to providing further input as staff continues with the next step of public consultations,” added DiMichele.

The average selling price of a home — including all houses and condos — climbed 17 per cent year over year last month to $1.09 million, the board said on Tuesday.

Detached houses in the 905 areas around the city continued to lead the growth; they were up 29.4 per cent over June 2020 to an average price of about $1.33 million. In the City of Toronto, detached houses sold for 11.5 per cent more than a year ago — going for about $1.7 million on average.

Condo sold for 8.3 per cent more in June compared to the same month last year, with the 905 communities seeing the greatest gain of 15.9 per cent to an average selling price of $611,610. That compares to a 6.7 per cent price growth, to an average of $717,466, within the City of Toronto.

The 11,106 homes that sold in June was a 28.5 per cent increase over June 2020, though down about seven per cent from May’s 11,951 transactions.

The real estate board had originally forecast home prices to hit an average $1.025 million by year’s end. But as sales continue to outpace new listings, TRREB has adjusted that up to an $1.07 million. Although the board says sales have peaked for 2021, the first quarter was so strong, it anticipates the year will end with 115,000 transactions, 10,000 more than it originally forecast.

The pent-up demand for housing has been satisfied in the absence of normal population growth, said the board’s chief market analyst Jason Mercer. However, he said, “A persistent lack of inventory across most segments of the market will keep competition between buyers strong, resulting in an average selling price well above $1 million through the end of 2021.”

While the market is still competitive, the frantic pace of sales earlier this year has passed, according to Toronto real estate experts, who spoke to the Star prior to release of TRREB’s report.

“It’s probably the first regular market cycle we’ve seen since the onset of COVID,” said Christan Bosley, president of Bosley Real Estate.

Although prices and competition vary according to neighbourhood and the property, “we’re not seeing the same volume of offers,” she said. “That kind of frenetic feeling is gone which is reassuring for people who realize these are regular market cycles.”

It doesn’t solve the city’s affordability challenge but it gives people a little more breathing room and time to do their due diligence, said Bosley.

She expects sales will ramp up quickly again in the fall. Meantime, the lull is realistic, given this double-dose summer, Bosley said.

“People are actually getting vaccinated, they’re feeling more comfortable in their own skin, they’re starting to travel again, spending time socially. Reconnecting is going to be a top priority for people … and the weather is nice,” she said.

Agents are still getting multiple offers but not as many, and competitive scenarios are drawing fewer bidders, said Desmond Brown of Re/MAX Hallmark.

“The last three deals I’ve done, we’ve negotiated price,” he said.

The slower pace of the market is changing the guidance that his team gives its clients, said Brown.

“We’ve got to start pricing closer to what we feel the market value is, as opposed to pricing it in the hopes we’re going to get multiple offers, because it’s just going to end up that we have to cancel it and relist it at a higher price,” he said.

It’s a good opportunity for buyers, said Brown.

“They won’t necessarily get something for a low, low price but at least they’ll have a chance to get in, they may have a chance to negotiate and if they do have to compete they won’t have to compete against as many other offers.”

According to a new report from the Toronto Regional Real Estate Board (TRREB), the average Toronto home price in February reached $1,045,488. This is a month-over-month increase of a whopping 14.9%.

The average price fell just below $1 million in Toronto, at an average of $995,201. The rest of the GTA, however, sat at a $1,071,512 average price point.

Last month, TREBB’s Market Year in Review & Outlook 2021 Report predicted that the average selling price for all home types in all regions of the GTA would surpass $1,000,000 for the first time and go on to reach $1,025,000. Evidently, it didn’t take very long to break that record.

Ivan Gorbadei, a salesperson with RE/MAX, says that he felt the TRREB projection was “conservative” and isn’t surprised to see prices rising as high as they are so quickly.

“With historically low interest rates and high sales, there are strong reasons to expect a solid price growth in Toronto and [the] GTA this year,” Gorbadei said. “Most of that growth is very seasonal and usually happens in the first five months of the year. Therefore, I am not surprised to see a hot start, knowing there will be some month-over-month cooling down later in 2021.”

The TRREB data also shows that detached homes in the GTA have an even higher new selling average of $1.37 million — a 23.1% year-over-year increase.

“It’s clear that the historic demand for housing experienced in the second half of last year has carried forward into the first quarter of this year with some similar themes, including the continued popularity of suburban low-rise properties,” said TRREB President Lisa Patel.

The number of sales in the GTA has also been skyrocketing. In February, 10,970 homes were sold, which is a 52.5% increase compared to February 2020.

One troubling aspect that the report highlights, however, is the low inventory available, which will likely further drive up prices.

“In the absence of a marked uptick in inventory, the current relationship between demand and supply supports continued double-digit average home price growth this year,” said TRREB Chief Market Analyst Jason Mercer.

With 10 more months left in the year and the average already hitting $1 million, we can only imagine what GTA home prices will be like by the end of 2021.

Jobs that previously required a schlep into the downtown core every day can now be done from anywhere — like in a city where detached house prices don’t average $1.75 million, perhaps.

It’s not necessarily that we want to leave the city, but many millennials are reaching a point where it’s time to decide on whether to remain a renter for life or move somewhere else and buy a home.

The former is increasingly difficult to do as prices rise for all home types across the city: To wit, a tiny bachelor condo in downtown Toronto currently costs the same as a brand new 4-bedroom house in Sarnia. For the same price as a 573-square-foot condo in Scarborough, you could buy a large house with an inground pool in London.

I could (and would love to) compare prices between Toronto and other Ontario locales all day, but you get the point: Money goes way, way further in real estate markets outside the big city.

But where does it go furthest?

Canadian real estate marketplace Zolo recently crunched economic and housing data from 200 small, large and medium-sized cities across the province to figure out which is the most affordable to buy a home.

Windsor came out on top across the board for large cities, proving the least-expensive for single earners and families alike, followed by London, Barrie, Kanata and Guelph.

“Windsor is so close to Detroit that countless Windsor residents commute there to work every day. The average price of a home in Windsor is $303,183, making it one of the most affordable cities in Ontario for families,” writes Zolo of the southern border city.

“Windsor is home to The University of Windsor, ranked as one of the best universities in the nation. Windsor is a family-friendly and affordable place that offers plenty of festivals, museums, and gardens, and don’t forget about the gorgeous waterfront view.”

In terms of cities considered “medium-sized,” Sarnia took the top spot for affordability, while Deep River was found to be the most affordable among Ontario’s small cities.

Though it’s just one of several factors that defines affordability, the average house of a price in Sarnia is just $358,000, according to Zolo. Thunder Bay, the second-most affordable “medium” sized city, has an average home price of $217,745.

Third on the list, Sudbury, boasts an average home price of $268,696, but it also seems like a pretty good option for (cold-tolerant) renters: “Rent for a three-bedroom apartment in Sudbury is $1,700, and a lot of the population is centered around the downtown area, giving it an urban feel without the inflated costs,” writes Zolo.

It’s the “small” Ontario cities, however, where you’re find homes so inexpensive you’ll wonder if I made a typo.

In Deep River, about 200 km northwest of Ottawa, the average home sells for just $217,000 while the average income is pegged at $100,343. You’d certainly have lots of extra cash to participate in all of the cross-country skiing and snowmobiling the region is known for.

“Each city was given a score of out 100 based on three measurements: affordability (based on comparing the average local income to the average price of local, single-family home); unemployment rate; and population growth,” explains Zolo of how it calculated these rankings.

“We examined the most critical element, housing affordability, by examining the average income of each city and then comparing that to the average price for a single-family home.”

That figure, known as the home-to-price ratio, was sourced via Statistics Canada data and Zolo’s own market trends for March 2021 to help analysts determine how long it would take for an average income earner in any given region to pay off the entire cost of the average priced house.

“For instance, a Home-to-Price ratio of 8.35 means it would take this average income earner just over eight years to completely pay off the average home price (assuming they threw their entire earnings to a debt that cost them nothing to carry),” reads Zolo’s latest report.

“While not a realistic expectation, this ratio does help provide a quick analysis of how affordable the housing market is in any given city, based on the earnings of its residents.”

As for how they decided which cities were big and which were small, Zolo followed the same formula for economic regions as Statistics Canada: Cities or towns with populations under 30,000 are considered small, cities and towns with population between 30,000 and 100,000 are considered medium, and cities over 100,000 are large.

Here are the full top five rankings for large, medium and small affordable cities, as well as their affordability score as estimated by Zoocasa.

Most affordable large cities in Ontario:
Windsor, 98.56
London, 97.49
Barrie, 97.06
Kanata, 96.92
Guelph, 96.22

Most affordable medium cities in Ontario:
Sarnia, 99.18
Thunder Bay, 98.58
Sudbury, 96.54
Stoney Creek, 96.84
Sault Ste. Marie, 96.52

Most affordable small cities in Ontario:
Deep River, 93.46
Rainy River, 91.62
Smooth Rock Falls, 90.60
Englehart, 88.93
Marathon, 88.91