Canadian housing affordability crisis is driving rental stock to record highs

Renters across the country are being forced to turn to private housing stock amid rising prices, with the average price of a detached home in Vancouver rising above $1 million, according to a new report.

The numbers came as Toronto saw the price of condos and townhomes rise to record heights in the second quarter of 2017.

In Toronto, the average condo and townhome sold for $1.9 million, a record for the city, according, the Canadian Real Estate Association (CREA).

The CREA report also noted the market has reached a new low with the price per square foot of new condos hitting $1,000 in the past three months.

“In Toronto, condos and condos sales are now at a new record low and are up 30 per cent year over year,” CREA chief economist John Ruggiero said in a release.

“The pace of price appreciation in the market, combined with the sharp decline in rental rates over the past two years, has left many buyers feeling squeezed.”

In Vancouver, a new study released by the Canadian Centre for Policy Alternatives (CCPA) found the city’s rental market has hit a record high in the last three months of 2017 with condo sales hitting $3.2 million in the third quarter.

The average price for a single-family detached home was up $2,200, according the study.

In Victoria, the price for condos hit $3,000, up 28 per cent from the third-quarter to the same period last year.

While the CREA data doesn’t break out the numbers for condos by size, it’s clear rental stock is hitting a record level.

The median price of condominiums sold in the GTA in March was $2.4 million, the highest price recorded since June of 2016, according data from real estate firm RE/MAX.

While some condo sales have slowed down recently, they’re still outpacing the increase in the overall market, the report found.

In the past year, the number of new listings for condos has increased by more than 20 per cent, compared to a decline of 4.2 per cent in the total market, according CREA.

The CREAs analysis said the increase comes despite the “tough economic climate,” which has “made condo sales harder to find.”

In fact, the median price per unit in Vancouver is up $1 per square metre, while the average unit price in Victoria is up nearly $300 per square metres.

Rental stock in Vancouver has “increased dramatically over the last decade, despite a significant decline in the value of real estate, and has surpassed the market’s historic level of supply,” CREAC CEO Andrew Mercer said in the release.

Mercer added the condo market in Victoria “has experienced the biggest increase in new sales since the recession, and the most dramatic price increases in more than 30 years.”

With files from The Canadian Press