Office of the Parliamentary Budget Officer
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Home affordability varies across Canada despite price drops, new PBO report finds

Ottawa (Ontario), October 2, 2025

The Parliamentary Budget Officer (PBO) today released an updated assessment of house prices in Canada.

This report examines how house prices compare to what an average household can afford, based on typical borrowing capacity.

While house prices at the national level remain well below their peak in early 2022, house price affordability has diverged across major Canadian cities.

The gap between the national average house price and what an average household can afford has narrowed from 80% in September 2023 to 34% in August 2025.

“This shift is largely driven by slower house price growth and falling interest rates. But the picture is far from uniform,” says Jason Jacques, Interim PBO. “While some cities are seeing improvements in affordability, others are becoming increasingly out of reach for the average household.”

To assess household financial vulnerability, the report compares average debt service ratios in Canadian cities to Canada Mortgage and Housing Corporation’s (CMHC’s) maximum Gross Debt Service (GDS) ratio, adjusted for non-mortgage expenses. While mortgage debt service ratios have declined for average households in Toronto, Vancouver and Victoria, they remain the most financially vulnerable of the census metropolitan areas (CMAs) considered in the report.

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    {"id":"RP-2526-011-S","is_published":"2025-10-02T12:57:08.000000Z","release_date":"2025-10-02T13:00:00.000000Z","last_revised_date":null,"title_en":"House Price Assessment \u2013 Update","title_fr":"\u00c9valuation du prix des propri\u00e9t\u00e9s \u2013 Mise \u00e0 jour","internal_id":"RP-2526-011-S","metadata":{"abstract_en":"This report provides an update of PBO\u2019s assessment of house prices relative to a household\u2019s capacity to borrow and pay for the purchase of a house in selected Canadian cities.","abstract_fr":"Ce rapport pr\u00e9sente une mise \u00e0 jour de l\u2019\u00e9valuation du prix des propri\u00e9t\u00e9s par rapport \u00e0 la capacit\u00e9 des m\u00e9nages d\u2019emprunter et de payer pour l\u2019achat d\u2019une maison dans certaines villes canadiennes.","highlights":[{"content":{"en":"While house prices at the national level remain well below their peak in early 2022, house price affordability has diverged across major Canadian cities.","fr":"Bien que le prix des propri\u00e9t\u00e9s \u00e0 l\u2019\u00e9chelle nationale reste bien inf\u00e9rieur au sommet atteint au d\u00e9but de 2022, l\u2019accessibilit\u00e9 du prix des propri\u00e9t\u00e9s varie d\u2019une grande ville canadienne \u00e0 l\u2019autre."}},{"content":{"en":"In Toronto and Hamilton, the gap between average house prices and what an average household can afford has narrowed significantly since early 2022. That said, house prices in Toronto and Hamilton are still well above their estimated affordable levels.","fr":"\u00c0 Toronto et \u00e0 Hamilton, l\u2019\u00e9cart entre les prix moyens des propri\u00e9t\u00e9s et ce qu\u2019un m\u00e9nage moyen peut se permettre s\u2019est consid\u00e9rablement r\u00e9duit depuis le d\u00e9but de 2022. Cela dit, le prix des propri\u00e9t\u00e9s \u00e0 Toronto et \u00e0 Hamilton est encore bien sup\u00e9rieur aux niveaux abordables estim\u00e9s."}},{"content":{"en":"Calgary, Montr\u00e9al and Qu\u00e9bec have seen the largest deterioration in house price affordability since early 2022. However, mortgage debt service ratios in these cities are still low compared to the most exuberant markets.","fr":"La plus forte d\u00e9t\u00e9rioration de l\u2019accessibilit\u00e9 du prix des propri\u00e9t\u00e9s depuis le d\u00e9but de l\u2019ann\u00e9e 2022 a \u00e9t\u00e9 observ\u00e9e \u00e0 Calgary, \u00e0 Montr\u00e9al et \u00e0 Qu\u00e9bec. Toutefois, les ratios du service de la dette hypoth\u00e9caire dans ces villes restent faibles par rapport aux march\u00e9s en plus forte effervescence."}},{"content":{"en":"Although mortgage debt service ratios have declined for average households in Toronto, Vancouver and Victoria, they remain the most financially vulnerable of the census metropolitan areas (CMA) considered in our analysis.","fr":"Bien que les ratios du service de la dette hypoth\u00e9caire aient diminu\u00e9 pour les m\u00e9nages moyens de Toronto, de Vancouver et de Victoria, ceux-ci demeurent les plus vuln\u00e9rables financi\u00e8rement parmi les r\u00e9gions m\u00e9tropolitaines de recensement (RMR) \u00e9tudi\u00e9es dans notre analyse."}}]},"updated_at":"2025-10-02T12:57:08.000000Z","type":"RP","slug":"RP-2526-011-S--house-price-assessment-update--evaluation-prix-proprietes-mise-jour","permalinks":{"en":{"website":"https:\/\/www.pbo-dpb.ca\/en\/publications\/RP-2526-011-S--house-price-assessment-update--evaluation-prix-proprietes-mise-jour","preview":"https:\/\/www.pbo-dpb.ca\/en\/publications\/RP-2526-011-S--house-price-assessment-update--evaluation-prix-proprietes-mise-jour"},"fr":{"website":"https:\/\/www.pbo-dpb.ca\/fr\/publications\/RP-2526-011-S--house-price-assessment-update--evaluation-prix-proprietes-mise-jour","preview":"https:\/\/www.pbo-dpb.ca\/fr\/publications\/RP-2526-011-S--house-price-assessment-update--evaluation-prix-proprietes-mise-jour"}},"artifacts":{"main":{"en":{"public":"https:\/\/distribution-a617274656661637473.pbo-dpb.ca\/dbfa2cbbdf25e87952f0d9873c6909578b80ad4d911d4599551bd6917db6ad9f"},"fr":{"public":"https:\/\/distribution-a617274656661637473.pbo-dpb.ca\/efbd00f38b3d1f4d87e1d2ca812189272a6a734ee0e9424a3fc784268598d329"}}},"coverpages":{"distribution":{"fr":{"small":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/3c556c03e3ebc719a0dfe1f3b879fe4d3bb68fdf5a15fd7b41f89794fe1d9ed5","large":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/df408d36b0de1d41b66bc165f5ba858d643ea689b768724af9274ab9b5e722bd","h150_png_optimized":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/4671a7650509c3a3706cf38922a8920782778959d2cd16ffbbdacdce7c3354a2","h150_webp":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/02985f2de6d8018e8c99e8434cd3bbcb28e4af28d9a5ad3eddc9284ec67ef0dd","h300_png_optimized":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/1bf7229d2442ef1686d77540067c2c3f22ddbce5dc6510bef90232dd1128a181","h300_webp":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/b36fd437445b9441ce333f60d0c1a795c1fb7c964304175602cafeeb81374bf0","h600_png_optimized":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/54e42ba5017f15ea5c4db984f1f2f6c2eb98865dfcad04011166aeaafb7d6e5e","h600_webp":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/643df2dfd711ceac0bf1267a1c91eb94897ea9cda0f2824893de49df0ddc8f01"},"en":{"small":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/36fe0cb792ac2e3f7cb4d6b6713163c0458c883d2108d280fbcd304d3f6b63d3","large":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/15d0af27adf0bbde322c1e99875015c2b4870feaece296606ee4fa6848495732","h150_png_optimized":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/705e9165c8d047544d16e1938e040aff38f356b1fe92845e1706876975af355e","h150_webp":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/599cb304a1d3f63f3e7320400b4a1e5d8284de95bfba94edfcef71b6609b4b31","h300_png_optimized":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/c560eb82d0d85e15ad0b2d0b9b698261917ed3f27a482028467405a626226aa0","h300_webp":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/9499c8accbcea14f3e12d20be780660c4579223bb5a61ffbece67f74cd19e7f6","h600_png_optimized":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/275e2d342802b4c7fffe01957871f63db0bcac826f1ad60171259e12dbd0e07b","h600_webp":"https:\/\/distribution-i696d61676573.pbo-dpb.ca\/501754b274cd6b474ef2f2663c363e26af14992ddfb899b3c16d89ec4dac2129"}}},"bills":[],"labels":[],"bibtex":{"en":"@techreport{PBO-RP2526011S,\n author={Cabral, James},\n title={House Price Assessment - Update},\n institution={The Office of the Parliamentary Budget Officer},\n year=2025,\n \n address = \u0022Ottawa, ON\u0022\n}","fr":"@techreport{DPB-RP2526011S,\n author={Cabral, James},\n title={\\\u0027{E}valuation du prix des propri\\\u0027{e}t\\\u0027{e}s - Mise \\`{a} jour},\n institution={Bureau du directeur parlementaire du budget},\n year=2025,\n \n address = \u0022Ottawa, ON\u0022\n}"}}