Canada’s housing crisis took off during the pandemic and based on a Sept. 13 report by the Canada Mortgage and Housing Corporation, it isn’t calming down anytime soon. The CMHC estimates that Canada needs to build 3.45 million new homes by 2030 in order to restore housing affordability.
While housing costs have dropped since the peak of COVID-19, they are still significantly higher than pre-pandemic pricing. As of September 2023, the average cost to buy a home in Canada was $655,507. Keep in mind that this is the average across the entire country.
In major cities, especially Toronto and Vancouver, those prices are significantly higher. For the same period, average homes in the Vancouver are were going for over $1.2 million while homes in the Greater Toronto area averaged at $1.13 million.
While the home prices might officially be dropping from their pandemic highs, another factor that Canadian homebuyers need to consider are mortgage rates. In September 2022, the overnight target interest rate set by the Bank of Canada was 2%.
A year later, we’re seeing the interest rate is 5%. That’s a significant jump that is causing many would-be homeowners — and current homeowners up for renewal — anxiety as it will make many homes even more unaffordable.
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Another huge cause of concern among Canadians when it comes to affordability are the soaring food costs. Canada’s Food Price Report for 2023 estimated that there would be a cost increase of 5% to 7% on food in Canada for the year of 2023.
The study broke down food into several categories. Surprisingly, fruit was expected to show the lowest cost increase at 3% to 5%. Vegetables, however, have been anticipated to increase as much as 8% throughout the year. As a result, Canadians were warned that a family of four could expect to pay an average of $1065.60 more on food than they did in 2022.
Cost increase predictions have been on track as Canadians stagger under the costs of their grocery bills. As MPs returned to Ottawa for the fall sitting, the Liberal party called on the CEOs of Canada’s biggest grocery chains including Loblaw, Sobeys, and Costco to discuss the inflated rates of food pricing. The hope is to come up with a plan to stabilize food prices in time for Canadian Thanksgiving weekend, now less than a month away.
Canadians are finding life in Canada far from affordable
With cost increases in housing, food, and more it would make sense that wages have gone up appropriately. However, that doesn’t seem to be the case and Canadians are struggling country-wide with the current costs of living.
A February 2023 report from Statistics Canada indicates that one in four Canadians are unable to afford an unexpected expense of $500.
So, how did Canada get named as the third best country to live in for 2023 (when affordability is one of the top criteria)? Well, as Canadian citizens we’re not so sure but hopefully it means some good news is coming our way.
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