Desire for lower living costs, closeness to nature, have urban dwellers considering relocation to a more affordable Canadian city.
50% of those living in the greater regions of Toronto, Montreal and Vancouver say they would consider buying a home in a more affordable city
Higher living costs, coupled with rising home prices and elevated interest rates, present a challenge for those trying to buy a home in Canada’s largest and most expensive urban communities. For some homebuyer hopefuls living in the country’s greater regions, relocation to a smaller but less expensive city offers not just the benefits of more attainable real estate, but also a lifestyle change.
According to a recent Royal LePage survey of Canadians living in the greater regions of Toronto, Montreal and Vancouver, conducted by Hill & Knowlton,1 half of respondents (50%) say they would consider buying a property in one of Canada’s most affordable Canadian cities, if they were able to find a job or work remotely. Among renters in these regions, 60% say they’d be willing to relocate, while 45% of current homeowners say they would consider it.
Fifty-seven per cent of respondents who say that they would consider relocating stated a lower cost of living as another incentive to buy a property in one of the most affordable cities. Forty-one per cent say they want to be closer to nature and live in a less populated area, and 40% say they desire a more relaxed pace of life. Respondents were able to select more than one answer.
Royal LePage identified the 15 most affordable cities based on the percentage of income required to service a monthly mortgage payment, using provincial median total household income data and city-level aggregate home price data. The mortgage calculation is based on a three-year fixed-term loan at 5.71%, amortized over 25 years with a 20% down payment.
Thunder Bay tops the list of most affordable cities in Canada where 22.2% of a household’s monthly income would be required to service a mortgage payment.2 Saint John, Red Deer, Trois-Rivières and Edmonton round out the top five, where between 25.1 and 28.9% of a household’s monthly income is needed to service a mortgage payment.
“There’s an old saying in real estate, ‘drive until you qualify.’ As housing affordability continues to deteriorate and Canadians face increasingly higher barriers to entry when buying a home, this adage is becoming more of a reality. Many aspiring homeowners in the country’s largest and priciest urban centres are seriously considering relocating to less expensive cities in order to get a foot on the property ladder,” said Karen Yolevski, COO, Royal LePage Real Estate Services Ltd.
“Compared to existing homeowners who have already set down roots, we know that renters are more likely to move to be able to afford a home. This flexibility is supported by the post-pandemic permanence of remote work opportunities, which continues to allow workers in many sectors to seek out housing that is within their budget, without worrying about proximity to their office,” added Yolevski. “In today’s higher borrowing cost environment, where the price of everyday goods has increased in tandem with interest rates, homebuyers are considering buying a home in a more affordable community.”
Here are a few highlights from the Royal LePage 2024 Most Affordable Canadian Cities Report:
- Of the 15 most affordable cities in Canada, four are located in the province of Quebec and four in the Atlantic provinces; no British Columbia cities made the list
- 54% of respondents in the Greater Montreal Area, 51% in the Greater Toronto Area and 45% in Greater Vancouver would consider relocating to one of the most affordable cities
- Quebec City is the most popular destination among respondents in Greater Montreal, while Edmonton is the top-ranking choice among Greater Toronto and Greater Vancouver residents
- Renters are more likely than owners to consider relocating based on housing affordability
To read the full report please click here
To read Royal LePages press release click here