Condo affordability in Canada has improved significantly, with the national measure nearly back to pre-pandemic levels, according to a new report from Royal Bank of Canada. The RBC condo affordability index, which tracks the share of income needed to cover homeownership costs, fell to 35.2% in the first quarter of 2025, less than one percentage point above the 2019 level.
Toronto and Victoria Lead the Recovery
In some markets, affordability has surpassed pre-pandemic benchmarks. Toronto and Victoria both saw their condo affordability indexes drop below 2019 levels, driven by sharper price corrections in the condo sector compared to other housing types. RBC economists Robert Hogue and Rachel Battaglia noted that these declines have helped restore affordability not seen since before the pandemic.
Toronto's condo market, in particular, has benefited from a price correction alongside steadily rising incomes. This has entirely rolled back the pandemic-era affordability deterioration for condos. However, single-detached homes in Toronto remain a challenge, consuming more than 80% of a typical household's pre-tax income, cementing the city's position as Canada's second least affordable market overall.
Vancouver Still the Least Affordable
Vancouver saw the largest year-over-year improvement in affordability among cities tracked by RBC, with the index dropping more than nine percentage points in the first quarter. Despite this, the measure only reverses half of the massive deterioration seen during the pandemic. Home ownership in Vancouver still requires 84% of income, making it the least affordable market in Canada by a significant margin.
“That’s the closest Halifax has been to Canada’s second most expensive market in more than a decade,” said Hogue and Battaglia. Halifax's condo affordability index sits at 41.6%, still 13.6 percentage points above 2019, one of the largest increases since the pandemic.
Montreal and Quebec City See Elevated Affordability
While relief has been widespread, some cities continue to experience elevated affordability challenges. Montreal's condo affordability index has topped Toronto's for the first time in 16 years, driven by a population boom and tight supply that have led to an aggressive lift in prices. Quebec City and Halifax also face similar pressures, with Halifax's measure within three percentage points of Toronto's.
RBC economists caution that the period of diminishing ownership costs may be ending. Prices have stabilized in most major markets, and any mortgage rate relief from the Bank of Canada this year is unlikely. “That means income growth would have to do a lot of the heavy lifting to see additional affordability gains — though labour market softness may limit the scope of that relief,” said Hogue and Battaglia.
Outlook for Canadian Housing
Nationally, the condo affordability improvement has been widespread, but the report highlights that single-detached homes remain out of reach for many. In Toronto, detached homes consume over 80% of pre-tax income, while in Vancouver, the figure is even higher. The report suggests that without further price corrections or significant income growth, affordability gains may stall.
The RBC report underscores the uneven recovery across Canadian housing markets, with condos leading the way back to pre-pandemic affordability levels while detached homes and certain cities lag behind.
