Here Are the Canadian Cities Where Housing Affordability Is Improving

Home ownership costs have declined in some of the most expensive Canadian housing markets in recent years, but affordability challenges remain.

By Josh Sherman | 3 minute read

While some of Canada’s biggest housing markets have become more affordable since the pandemic, others — particularly those with lower home prices — have seen ownership costs climb.

Since home prices peaked towards the tail end of the pandemic, housing affordability in Canada has shown marked improvement by certain measures, with some of the country’s most expensive markets seeing housing costs drop significantly.

In fact, between May 2022 and September 2025, both monthly mortgage payments and the minimum qualifying incomes required on homes in Toronto and Hamilton have declined by more than 10% for prospective buyers.

These are just some of the findings from a new co-authored report from Wahi, a leading Canadian real estate platform, and Perch, a top digital mortgage platform.

“Affording a home, especially in the city, can be a challenge, but we know from a previous Wahi survey that many Canadians are willing to do whatever it takes to step on the property ladder,” says Wahi Economist Ryan McLaughlin. “This study puts into perspective what homebuyers can expect and, in some cases, demonstrates how conditions may be more favourable today,” he continues.

The Wahi-Perch joint study takes the pulse of housing affordability across 13 large census metro areas from coast to coast. It looks at how both typical monthly mortgage payments and qualifying-income requirements have evolved since home prices crested amid the pandemic boom. It also measures affordability relative to local incomes. The analysis assumes a 10% downpayment, the lowest available insured-mortgage rate, and amortizations of both 25 years and 30 years, respectively.

In terms of monthly mortgage payments and qualifying incomes on a 25-year mortgage term, only Toronto and Hamilton saw decreases between May 2022, when the RPS-Wahi House Price Index peaked, and September of this year. 

“We’re seeing first-time home buyers capitalize on this opportunity in the Greater Toronto Area. They’re able to add the conditions they want to their offer, negotiate on price and arrange for a closing date that is on their timeline (not the seller’s)” says Perch Principal Mortgage Brokerage Alex Leduc.

Although no other markets saw outright decreases, the inflation of monthly payments and qualifying incomes were relatively subdued in Halifax, Ottawa, Victoria, and Vancouver compared with the rest of the country.

The metro areas where these potential barriers to ownership intensified the most — led by Quebec City, with monthly mortgage payments and minimum incomes surging upwards of 40% — had lower home prices to begin with.

Conversely, it is weaker market conditions in southern Ontario that have benefited homebuyers the most. “Sharp home price declines are the primary driver of reduced ownership costs in Toronto and Hamilton,” adds McLaughlin.

25 Going on 30: How Longer Mortgage Amortizations Affect Housing Affordability

In 2024, the federal government introduced extended amortization periods — which reduce monthly payments by spreading them out over a longer timeframe but increase the total amount of interest paid — for first-time homebuyers and all buyers of newly built homes.

For borrowers with a 25-year amortization, not much changed at the national level between 2022 and 2025 in terms of the income required or the monthly mortgage payment amount.

However, if a 30-year amortization is selected, the barriers to ownership are lower today than they would’ve been three years ago with the same terms. 

While these 30-year amortizations weren’t available at the onset of the study period, the comparison shows how these terms can boost homebuying power. Note that homebuyers need to weigh whether paying more interest over a longer term is a worthwhile tradeoff. 

For 30-year amortizations, six markets saw reductions in qualifying incomes between 2022 and 2025, monthly payments, or both: Montreal, Ottawa, Victoria, Vancouver, Toronto, and Hamilton. 

Other key findings on 30-year amortizations:

• Conditions eased the most in Toronto and Hamilton where the combined effect of longer amortizations and lower home prices sliced roughly 20-25% off of the mortgage payments and qualifying incomes required.
• Qualifying incomes fell from $260,000 to $210,000 in Toronto and from $215,000 to $170,000 in Hamilton.
• Although Quebec City still saw the biggest jumps, the 30-year amortization softened the blow somewhat with mortgage payments up 28% rather than 44%, for example.
• Nationally, the extended loan period reduced monthly mortgage payments substantially (11%), and the qualifying income also declined modestly (3%) from 2022 to 2025. 

Homeownership Becomes More Within Reach in 7 Major Canadian Housing Markets

In addition to qualification criteria and monthly carrying costs, local household incomes are a key determining factor of affordability.

When changes to local incomes are taken into account, affordability improves at the national level as well as in seven markets between 2022 and 2025:

• Halifax
• Hamilton
• Ottawa
• Regina
• Toronto
• Vancouver 
• Victori

The study defines an improvement in affordability as occurring when the median household income as a percentage of the qualifying income required increases (meaning a typical household is closer to the required income to buy).

While affordability has improved by this measure in a majority of markets, challenges remain. In nine markets, the estimated median household income for 2025 still fell short of the minimum qualifying income, up from seven in 2022. Nationally, the median household income amounts to roughly two-thirds (64%) of the necessary qualifying income.

Rapidly rising home prices have eroded affordability in Calgary and Quebec City — where the median household income now fails to qualify — that’s yet to occur in Edmonton, Saskatoon, Regina, and Winnipeg.

These four metro areas in the Prairies have maintained relative affordability even in the face of price exuberance. They have also been some of the most resilient housing markets during the Canadian real estate downturn. Relatively lower home prices, strong labour markets, and population growth have sustained housing demand. 

Sources:

Home Value Estimates are from Real Property Solutions RPS Inc. and include both resale and new homes.

Median household incomes for each CMA were provided by Statistics Canada. The most recently available data was for 2022 and 2023, in current dollar values. The 2023 median was adjusted for national wage growth in 2024 and 2025, as per Trading Economics.