It may be a long, long wait for any potential first-time homebuyers hoping for Metro Vancouver’s housing bubble to burst before making a down payment.
Strong demand for housing across the region continues to outpace supply and is creating some of the worst levels of affordability ever seen in the country, according to RBC’s second quarter housing affordability index.
The index, which measures the proportion of pre-tax household income needed to cover the costs of owning a home at market values, increased in all categories (an increase in the index indicates a decline in affordability) over the past quarter.
For a two-storey home, the index rose 3.7 percentage points to 90.6% compared with Q1 and went up 3 percentage points to 88.6% for a bungalow.
Condos were the most affordable, as the index went up just 0.5 percentage points to 40.1% in that category.
"Vancouver's housing affordability readings are nearing the worst levels ever recorded in Canada, but this is still not reining in buyer demand at all," RBC chief economist Craig Wright said in a statement.
"Given the current high degree of tightness in the market, further price acceleration and affordability deterioration are even very likely in the near term."