Quote:
Originally Posted by jonny24
Having a high absolute number for income-to-price isn't out the norm.
It's the massive increase in that ratio, specifically over a 20 year period, that isn't.
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The increase is over a longer period. Price to income ratios from 1980 to 2000 were more stable, and interest (and mortgage) rates were higher. Prices in Vancouver Toronto and Montreal took off from around 2000, and as interest rates stayed low, price to income ratio continued to grow.
Here's those three cities. Obviously there are other factors that impacted the period, leading to high demand vs new house building supply, including a higher proportion of investment purchases by local and foreign owners, the creation of short term rental platforms, and demographic and societal change tending to see smaller households. Interestingly, in the past 30 years, total debt to income ratios have stayed in a fairly narrow band - families may have taken on greater mortgage debt, but have generally had lower non-mortgage-related debts.
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