Affordable housing in Canada

Affordability of housing in Canada presents a complex paradox. By 2004, 1.7 million Canadians had housing affordability issues, yet Canada is considered to be among the more affordable places to live, using market-oriented analyses of affordability such as those provided by the Royal Bank of Canada. Canadian government public policies intervene when affordability of housing is stressed to the point home ownership becomes inaccessible even to individuals with full-time employment. The continuum of affordable housing in Canada includes market (affordable rental housing, affordable home ownership), non-market (affordable rental housing, affordable home ownership), government-subsidized housing (emergency shelters, transitional housing and social housing). Measuring affordability of housing is complicated by Canada's vast physical and human geography which includes remote northern communities and affluent urban regions. Housing prices and construction costs have risen dramatically in Canada as they have elsewhere in the world. Income levels in the upper quintile have increased exponentially while those in lower quintiles have remained stagnant. The rising inequality gap presents a significant challenge for Canadian households who are "priced out" of rental and ownership housing markets.

Eighty percent of Canadians are served by market-based housing, which includes individual home ownership and private rental housing. In the market-based housing system, individuals finance their own housing, independent of government assistance.

A 2012 RBC Economics report on home affordability says its index deteriorated only slightly. However, the shelter-cost-to-income ratio (STIR) is well above 30% for the median income. Nationally, it is 48.7% for two-story homes. Major cities such as Vancouver rate worst in the world at 88.9%. Calgary is considered affordable at 36.7%. Montreal is 41.8% and Toronto is 53.4%. The RBC Indicator provides data on a quarterly basis on home ownership affordability, it measures the proportion of homes currently for sale that are affordable to a median income household. Measurements of affordability that are oriented exclusively to the ability to buy using mainly shelter-cost-to-income ratio (STIR) provide useful information for one end of the continuum of housing in Canada, home ownership in the private market at market price.

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