Report says homeownership in Manitoba “reasonably achievable”


Manitoba's housing affordability experienced some of the most noticeable improvements in the country during the third quarter of 2011, according to the latest Housing Trends and Affordability Report by RBC Economics. 
Homeownership costs in the province fell, as mortgage rates eased and home prices reversed some of the record-breaking gains made in the second quarter.
“Manitoba's affordability levels continue to stand near their historic norms — a telltale sign that homeownership in the province is reasonably achievable,” said Robert Hogue, senior economist, RBC. “Home buyers took advantage of this more affordable market in the third quarter, pushing home resales higher by 5.3 per cent.”
RBC's housing affordability measures for Manitoba, which capture the provinces proportion of pre-tax household income needed to service the costs of owning a home at the going market value, decreased across all housing types in the third quarter of 2011, with a decrease representing a gain in affordability. 
The measure for the benchmark detached bungalow in the province fell to 35.6 per cent, a decrease of 1.2 percentage points from the previous quarter); the standard condominium to 21.4, down 0.5 percentage points; and the standard two-storey home to 37.9 per cent, a decrease of 1.5 percentage points.
“It’s a great time to buy real estate in Winnipeg and Manitoba,” said WinnipegREALTORS® president Ralph Fyfe.
“We’ve been blessed,” he said. “Manitoba is a relative safe haven of stability with so many positive things happening. There are new construction projects and new developments, such as the return of the Jets, which make Winnipeg and Manitoba a very positive and healthy economic environment.
“And as the RBC report indicates, real estate is still a relative bargain,” Fyfe added, “especially with the low interest rates and a sound local economy, which bodes well for a continuation of a strong real estate market into 2012.”
When purchasing a home of any type, Manitobans needed significantly less annual income in the third quarter than their neighbours in Saskatchewan and Ontario. 
The benchmark detached bungalow in Manitoba cost $263,700 in the third quarter, which required an annual income of $62,200 to purchase. In Ontario, the annual salary required to purchase the same type of bungalow was $82,200, while in Saskatchewan, the yearly salary required was $72,100.
For a standard condominium, a yearly salary of $37,500 was needed in the third quarter in Manitoba, while it took $48,800 in Saskatchewan and $57,500 in Ontario.
When a standard two-storey was purchased in the third  quarter, Manitobans required an annual salary of $66,300, while Ontarians needed $94,200, and $77,800 was required in Saskatchewan. 
According to the report, affordability levels in Manitoba are at, or slightly below, long-run averages, which indicate little in the way of overdue pressure being applied to the province’s home buyers.
RBC's housing affordability measure for the benchmark detached bungalow in Canada’s largest cities is as follows: Vancouver 90.6 per cent, Toronto 52.1 per cent, Montreal 40.9 per cent, Ottawa 40.8 per cent, Calgary 37.6 per cent and Edmonton 33.2 per cent.
An affordability reading of 50 per cent means that the homeownership costs, including mortgage payments, utilities and property taxes, take up 50 per cent of a typical household’s monthly pre-taxed income.