It takes double the amount of work to afford to buy a home in Canada today compared to the 1970s, according to new research published by the Broadbent Institute.
The study, by Marc Lavoie, Economics Professor at the University of Ottawa and Broadbent Institute policy fellow, looked at whether homes were becoming less affordable over time.
He found that eight to nine years of work, on an average Canadian wage, are now needed to finance a mortgage – more than double the four years needed back in 1970.
And if you thought buying your home outright might be a little less labour intensive, then think again, says Lavoie.
He found homebuyers would need to work for 400 weeks, or eight years, to buy the average home outright now – more than double the four years needed back in 1970.
“Clearly, at cash cost, young Canadians who wish to own their dwelling are much worse off than were their parents when they bought their house in the 1970s or during the first half of the 1980s,” writes Lavoie.
“Current and recent buyers need to devote many more weeks of labour time to the financing of their home than their predecessors,” writes Lavoie.
“No wonder so many young prospective buyers, especially those in major cities, feel that owning a residential unit is more like a long-distance dream.”