Montreal real estate and household incomes

Rob Carrick from the Globe & Mail is back at with an article entitled "Can you afford a home in these cities?" I love how Rob keeps it real and puts things in a comparative perspective. Rob again applies his Real Life Ratio indicator when looking at home affordability in various Canadian cities. According to him, "Montreal's a trouble spot, with actual household income well below the estimated income required to carry the average home." I would agree with him that "Falling prices would help some prospective home buyers, but its not a big factor as you'd expect." I also agree that if the Real Life Ratio, i.e. the common sense calculation for owning a home doesn't work then it's okay to rent or save on building a large down payment.

Canadian household debt

Happy rainy Monday Montrealers. Today, an article in the Montreal Gazette caught my eye entailed "Household debt worries ease as mortgage borrowing slows in May: RBC." The RBC states that Canadian homeowners have been slowing down on the amount of mortgage debt that is assumed. Yes debt-load and market values are critical indices in Canada and I have no doubt that we're taking on less debt but I don't think it's because we are smarter consumers.

Are we managing our household debts better?
Picture: Huffington Post & Alamy Photo 

Perhaps Canadian homeowners are "hitting a wall" when it comes to assuming more debt and mortgages. This is an income issue. I am sure that if wages went up then Canadians would most likely assume more debt as well.

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