Canada Housing Market

A new housing affordability warning from Desjardins is drawing attention across Canada after the bank suggested some major cities have entered what it calls “impossibly unaffordable” territory.

According to the report, homeownership in cities like Vancouver and Toronto is increasingly moving out of reach for average households as housing costs continue to far outpace incomes.

Vancouver Ranked Among The Least Affordable Markets

Desjardins says Vancouver has now entered “impossibly unaffordable” territory, with housing costs sitting more than nine times above average household income levels.

The warning reflects growing concerns around:

• rising home prices
• elevated mortgage costs
• weak affordability
• slower wage growth
• long-term housing supply issues

The report suggests affordability conditions in some Canadian cities have deteriorated so severely that returning to pre-pandemic affordability levels may no longer be realistic without major structural changes.

Toronto Also Facing Major Affordability Pressure

While Vancouver was highlighted as one of the most extreme examples, Desjardins also pointed to Toronto as another city where ownership costs remain heavily disconnected from household incomes.

Over the past several years, many younger Canadians and first-time buyers have increasingly shifted toward:

• renting longer-term
• living with family longer
• moving to smaller markets
• relocating to lower-cost provinces

Housing affordability continues to remain one of the most discussed economic issues in Canada heading into 2026.

Renting Is Becoming A Long-Term Reality For Many Canadians

The report also noted that renting is increasingly shifting from a temporary life stage into a long-term reality for many households.

This trend has become especially visible in major urban markets where:

• down payments remain difficult to save
• mortgage qualification rules remain strict
• monthly ownership costs remain historically high

Many economists continue warning that affordability pressures could impact consumer spending, family formation, migration patterns, and long-term economic growth.

Could Affordability Improve?

According to Desjardins, significantly improving affordability may require a combination of:

• stronger income growth
• substantially lower interest rates
• major increases in housing supply
• meaningful home price declines

While some Canadian markets have seen prices soften from pandemic highs, affordability conditions in cities like Vancouver and Toronto remain historically challenging.

What This Signals For Canada’s Housing Market

The Desjardins warning highlights how deeply affordability concerns continue shaping Canada’s housing conversation in 2026.

While housing markets across the country are moving at different speeds, major cities continue facing growing pressure around affordability, ownership accessibility, and long-term cost of living challenges.

References

Desjardins. (2026). Housing affordability commentary and market analysis. https://www.desjardins.com/

Instagram post by @debunkcanada referencing Desjardins affordability analysis. https://www.instagram.com/debunkcanada/