Steep housing prices across Canada's large cities have potential buyers turning to condos — and finding the math still isn't pretty.

In RBC’s latest quarterly housing report, it’s the deteriorating affordability of owning a condo that jumps out. Even as a softer housing market offers some nationwide relief, affordability is still at crisis levels in Vancouver and Toronto, and condos are no exception.

In fact, over the past year, RBC’s affordability measure for condos worsened at three times the rate compared to single-detached homes.

The stronger demand for condos in Canada’s cities has resulted in sharper price gains, which is no surprise. What’s striking is that these gains are even outpacing the rise in rents. The premium on owning a condo has ballooned over the last three years. Buyers of an average condo in Vancouver, Toronto, Victoria and Montreal pay over $900 more per month compared to those renting a two-bedroom apartment. That adds up to a difference of more than $10,000 a year – making buying a condo not just a step, but a leap.

While still more affordable than a single-family home, buying a condo is a much more distant next step for renters in Canada’s largest cities. Look for rental demand to rise rapidly in the years ahead.

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As Senior Vice-President, Office of the CEO, John advises the executive leadership on emerging trends in Canada’s economy, providing insights grounded in his travels across the country and around the world. His work focuses on technological change and innovation, examining how to successfully navigate the new economy so more people can thrive in the age of disruption. Prior to joining RBC, John spent nearly 25 years at the Globe and Mail, where he served as editor-in-chief, editor of Report on Business, and a foreign correspondent in New Delhi, India. Having interviewed a range of prominent world leaders and figures, including Vladimir Putin, Kofi Annan, and Benazir Bhutto, he possesses a deep understanding of national and international affairs. In the community, John serves as a Senior Fellow at the Munk School of Global Affairs, C.D. ‎Howe Institute and is a member of the advisory council for both the Wilson Center’s Canada Institute and the Canadian International Council. John is the author of four books: Out of Poverty, Timbit Nation, and Mass Disruption: Thirty Years on the Front Lines of a Media Revolution and Planet Canada: How Our Expats Are Shaping the Future.

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