Market Insight for November 21

A new global analysis suggests Canada’s major cities are among the hardest places on earth for young people to buy their first home, with Vancouver, Toronto, and Montreal ranking near the bottom of a 70-city affordability index.

The study, from UAE-based developer Bloom Holding, estimates the typical first-time buyer in Vancouver enters the market at age 46, while those in Toronto and Montreal reach homeownership at around 40 and 39, respectively.

In 1991, the typical first-time buyer was able to purchase a home by the time they were 28 years old. That number gradually climbed to 33 in 2020, then shot up to 36 in 2022 and 38 in 2024, as higher rates and decade-long price gains delay ownership for younger households.

Bloom’s analysis calculates how long it takes an average-income resident in each city to save a 15–25% down payment, assuming they begin saving at around age 23. On that metric, Canadian cities stand out for the sheer time required to accumulate a deposit:

• Vancouver: estimated down payment $347,000; first-time buyer age 46.
• Toronto: estimated down payment $252,000; first-time buyer age 40.
• Montreal: estimated down payment $240,000; first-time buyer age 39.

Michael Davenport, Senior Economist at Oxford Economics, said the findings align with the firm’s own affordability metrics, noting that Canada’s housing challenges remain heavily concentrated in major metro areas such as Greater Toronto and Greater Vancouver. Even with modest improvements driven by easing prices and lower mortgage rates, he emphasized that affordable housing is still out of reach for many households across key Ontario and British Columbia cities.

Oxford Economics’ Housing Affordability Index (HAI), which measures the borrowing capacity of a median-income household assuming a 20% down payment, has eased meaningfully over the past two years.

The housing affordability index is meant to measure the share of disposable income that a representative household would put toward housing-related expenses. The measure is a ratio of housing-related costs (mortgage payments and utility fees) to average household disposable income. The higher the ratio, the more difficult it is to afford a home.

The national HAI fell from 130 in mid-2023 to 104 in Q2 2025, its lowest level since 2020. At that level, the average home is still about 4% more expensive than what a median-income household can borrow, but affordability is improving.

City-level results remain uneven: Vancouver’s HAI has fallen from 189 to 153 but remains the least-affordable city in the country; Toronto’s has dropped from 163 to 132; and Montreal’s from 108 to 96, making it generally affordable on a borrowing basis.

The report highlights how saving for a down payment remains a significant challenge for many households — particularly in the GTA and GVA.

Governments have introduced measures aimed at improving affordability, including loosening mortgage lending guidelines, allowing 30-year mortgages for first-time buyers and new builds, GST reductions on eligible new homes, and programs designed to increase housing supply. Government measures to moderate immigration levels are also helping ease demand pressures.

Over time, Davenport expects national housing affordability to improve as supply expands faster than demand.