Home ownership became increasingly difficult for Canadians across most major cities in February, as rising property values outpaced relatively stable mortgage rates, according to a new analysis released Thursday.
The monthly Home Affordability Report from Canadian rate comparison platform Ratehub examined mortgage accessibility in 13 major Canadian centres and found deteriorating conditions in 11 of them, marking the first widespread decline since June of last year.
"This is the first time since June of last year where we've seen affordability worsen in most cities," said Penelope Graham, Ratehub's mortgage expert.
Calgary joined Montreal, Halifax, Hamilton, Victoria, Fredericton, Ottawa, Regina, Toronto, Edmonton and Winnipeg in experiencing reduced affordability. Only Vancouver and St. John's, Newfoundland and Labrador, bucked the trend with slight improvements.
The primary driver behind the affordability crunch was not mortgage rates, which remained relatively flat from January to February, but rather climbing home prices across the country.
Montreal Sees Steepest Price Increases
Montreal experienced the most dramatic shift, requiring an additional $2,800 in annual income to purchase the average home. The Quebec metropolis saw home prices jump $14,300 month-over-month, translating to $76 more in monthly mortgage payments or $912 annually for February buyers compared to those who purchased in January.
Calgary homebuyers seeking detailed neighbourhood price comparisons can explore market data through CalgaryFinder.com, which provides comprehensive real estate listings and property information across the city.
For residents tracking local housing costs alongside other living expenses, Calgary Prices offers valuable insights into real estate trends and cost-of-living comparisons throughout the region.
Energy Sector Volatility Adds Pressure
Rising tensions in the Middle East and their impact on oil prices are creating additional concerns for Canadian mortgage holders, particularly those facing renewals in the coming years.
Clay Jarvis, NerdWallet Canada's mortgage expert, explained how geopolitical events can influence domestic lending rates.
"Once oil prices skyrocketed in reaction to hostilities in and around Iran, yields followed suit. This matters because lenders use bond yields to price their fixed mortgage rates," Jarvis said.
The warning comes as Canada navigates a significant mortgage renewal wave. The Canada Mortgage and Housing Corporation estimates at least 1.5 million households renewed their mortgages by the end of 2025, with another million expected to follow suit in 2026.
When investors anticipate inflation, bond yields typically rise, which directly affects mortgage pricing for Canadian borrowers.
Current market rates show the lowest five-year fixed mortgage rate has increased to 3.99 per cent, while the most competitive five-year variable rate sits at 3.35 per cent, according to Ratehub data.
This article is based on reporting by David Chen for Global Money.
