Toronto is now cheaper than New York and Miami

A new report on housing affordability in North America has some great news for Torontonians who have always dreamed of moving to the US.

While North American housing markets have been affected by rising interest rates and low inventory over the past few years, Canadian buyers have been particularly hard hit thanks to lower median incomes, according to a Zoocasa report.

In much of North America, the cost of living is rising, and median incomes are rising at a slower pace. Photo: Zoocasa.

In 2021, the median household size in the U.S. was $75,149 in Canada and $54,074 ($73,000) in Canada, and the gap between the two countries is only apparent when you examine the national average home prices.

According to the report, the median home price in Canada was $30,000 higher than the U.S. in 2022, even though the median income of Canadians was $20,000 lower.

To compare housing affordability levels in 40 North American cities, Zoocasa analyzed median housing prices, median income, and maximum affordability.

Housing affordability in major US and Canadian cities. Photo: Zoocasa.

The report found that major US cities, including New York, Miami, Nashville, Phoenix, Dallas, Houston and Philadelphia, are more affordable than Toronto when it comes to housing.

Overall, San Francisco was found to have the most significant gap between maximum affordability for middle-income households and the median home price at a staggering $644,338.

“However, of all the cities we analyzed, San Francisco has the highest median income, meaning homebuyers have the highest purchasing power. Households with the median income in San Francisco can afford a home worth about $612,162, the highest on our list and double the about more than what middle-income households in Vancouver and Toronto can afford,” the report said.

Figures are based on January 2024 home prices, a 20% down payment and a 30-year mortgage with a fixed rate of 6.79% (or 4.79% for Canadian borrowers). Photo: Zoocasa.

Although Toronto's median income is comparable to Dallas, the real estate agency found that the median home price in Toronto is $718,519 versus $393,650 in Dallas.

“This results in a gap of just $107,093 between peak affordability and the median home price in Dallas, while the gap in Toronto is three times larger than in Dallas,” the report said.

“In Toronto, median income households can afford homes worth about $355,892, which is $362,627 less than the median home price.”

Still, it's not all bad news for Canada, as middle-income earners in Calgary, Winnipeg, Edmonton, Saskatoon and Saint John can afford the average home price in each respective city.