RBC Economics reports the national affordability measure has fallen but warns the pace of progress may be slowing
Canada's housing affordability improved for a ninth consecutive quarter in Q1 2026, reaching its best position since early 2022, though new data from RBC Economics suggests the window for further gains may be narrowing.
RBC's national aggregate affordability measure, which tracks the share of median pre-tax household income required to cover mortgage payments, property taxes, and utilities, fell 1.4 percentage points to 53% in Q1 2026, according to the report authored by Robert Hogue, assistant chief economist at Royal Bank of Canada, and economist Rachel Battaglia.
A lower reading indicates improved affordability. Vancouver and Toronto led the national recovery, even as both cities retained their positions as Canada's least affordable markets.
Montreal, Quebec City, and St. John's moved in the opposite direction, with homeownership costs continuing to climb.
Condos have accounted for the most meaningful progress. The national condo affordability measure now sits at 35.2%, within one percentage point of where it stood before the pandemic.
In Toronto, the condo measure has pulled back to 36.1%, down from 38.5% in Q4 2019, while Victoria's condo affordability has improved to 31.8%, slightly below its pre-pandemic level of 32.2%.
The data marks a notable turnaround for a segment that was among the hardest hit by the post-2022 rate environment, and which Canadian Mortgage Professional has tracked closely through the ongoing difficulties facing Toronto's condo sector in early 2026.
Not all markets have participated in the condo recovery. Tight inventory and the earlier population surge have kept condo prices elevated in Montreal, Quebec City, and Halifax.
Montreal's condo affordability index has now exceeded Toronto's for the first time in 16 years, a reversal that reflects persistent price strength in Quebec's largest city, where home values were 5.5% higher year over year in Q1.
Affordability gains are running out of road
RBC's economists caution that the recovery phase for affordability across Canada may be drawing to a close.
With prices stabilising in most major markets and the Bank of Canada widely expected to hold its policy rate through the remainder of 2026, the levers that drove improvement, falling home values and declining mortgage costs, are no longer operating with the same force.
"More varied outcomes will work to temper affordability gains in the year ahead," Hogue noted in a March 2026 analysis, adding that Canada is "likely approaching the end of the recuperation phase for housing affordability."
His Q1 2026 findings reinforced that view, with RBC projecting that wage growth will need to carry the weight of any further improvement, a scenario complicated by labour market softness that may limit income gains until 2027.
For brokers advising clients in Vancouver — where RBC's aggregate measure tumbled 4 percentage points quarter-over-quarter and 9.3 points year-over-year to 84.1% — the split between condo and detached markets shapes every conversation.
Vancouver's aggregate affordability measure remains the worst in the country by a significant margin, and RBC sees the price correction continuing into the second half of 2026 as trade uncertainty and geopolitical tensions weigh on buyer confidence.
Regional outlooks diverge sharply
Calgary, where RBC's aggregate measure stands at 41.5% — close to its long-run average of 39.8% — has largely absorbed the post-pandemic affordability shock.
Resales are running approximately 25% above pre-pandemic levels, supported by Alberta's comparatively robust economy and sustained population growth.
Edmonton tells a different story. RBC's aggregate measure there has barely moved in the past year, sitting at 36.8% against a long-term average of 32.9%, while Winnipeg's measure of 33% remains near its highest point since 1991.
RBC's economists suggest a deeper demand pullback would be needed to push Winnipeg prices down meaningfully.
In Quebec City, conditions have deteriorated consistently since the end of 2023, the only market among those tracked where affordability has not improved over that period. The city's aggregate measure now sits at 39.5%, some 9.3 percentage points above its 10-year average.
Halifax, meanwhile, sits 13.6 points above its 2019 level at 41.6%, though a near-tripling in units under construction over the past decade could help ease pressure in the housing system.
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