More people can afford to buy BC homes

Housing affordability in B.C. over the past year has improved the most since 1991, RBC Economics says.

The percentage of income required for various housing types in the province fell by 3.4 to 7.4 percentage points during the first quarter of the year, RBC said in a report released yesterday.

The average cost of maintaining a detached bungalow in Vancouver was 62.6 per cent of household income during the first quarter, while in Toronto it was 45.9 per cent, RBC said. Calgary affordability was 35.1 per cent.

"The repair of poor affordability levels in British Columbia accelerated significantly in the first quarter of this year," RBC said.

"Sales of existing homes have picked up vigorously from historical lows during the November-January period and prices have shown hints of levelling off."

A slower pace of existing homes going up for sale in B.C. and with low construction levels for new ones will likely put a floor under prices in coming months, RBC said.

Across the country, weaker home prices and lower borrowing costs are attracting buyers back into the housing market, RBC said..

"Declining costs of home ownership during the last year were driven by significant cuts in mortgage rates along with the federal government taking an active role in supporting the mortgage securities market," RBC said.

RBC's affordability index -- the percentage of pre-tax monthly household income needed to maintain a home, including mortgage payments, utilities and property taxes -- improved across all housing segments in Canada.

(Source: Vancouver Province)