The Decibel The benchmark of housing affordability has changed in Canada
Jun 30, 2025
Rachelle Younglai, a housing and real estate reporter for The Globe and Mail, discusses the Canada Mortgage and Housing Corporation's shift in housing affordability benchmarks. She reveals that returning to 2004 affordability levels is impossible due to increased home prices and rent. Younglai highlights the impact of remote work on housing demand, particularly in smaller communities, and explores the contrasting interest in condos versus detached homes. The conversation underscores ongoing challenges in the market, including rising interest rates and construction barriers.
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Shift in Housing Affordability Benchmark
- CMHC changed the affordable housing benchmark from 2004 to 2019 due to market changes.
- The new benchmark reflects more realistic housing cost standards for Canadian residents.
Housing Costs Growth Example
- In 2004, typical home price was $240,000, rent averaged $700; in 2019, prices doubled, rents doubled.
- By today, home prices are $700,000 and rents $1,400 on average, reflecting steep increases.
Why 2019 Is the New Benchmark Year
- 2019 was chosen due to stable affordability across most of Canada pre-pandemic.
- The pandemic drove prices up due to low interest rates and remote work relocating buyers.