Toronto’s real estate market has only been getting more and more unaffordable — and a new report shows exactly how drastic that lack of affordability is compared to 30 years ago. Over the past three decades, the average price of a home in Toronto has increased by a staggering 205 per cent, massively outpacing the growth in median household income.

In 1994, the average home price was approximately $196,731, equal to $364,494 in today’s value, while the median household after-tax income was $39,114, or $72,472 in today’s dollars. At that time, homes were much more affordable — the average home would cost you around five times the median household income in Toronto.

But 30 years later, in 2024, the city’s housing situation is shockingly different. The average home price surged to a whopping $1,111,944 — but the median household income is only at $95,982. By comparison, homes now cost about 12 times the median household income, clearly pointing a massive drop in housing affordability.

The report by Ratesdotca stated that Toronto has become a “symbol of the housing crisis” in Canada. “Over the past three decades, Toronto’s real estate market has seen unprecedented levels of soaring home prices due to population growth, and high interest rates and inflation.”

The report noted that the city hasn’t been able to keep up with the demand for housing, with “regulatory barriers and building costs” creating more obstacles in the efforts to increase housing supply. 

The report also looked at housing prices nationally, finding that the average housing price in Canada has increased 132 per cent since 1994, while income has increased just 36 per cent.

Home ownership demographics have also shifted in Toronto, according to the report. “In the 1990s, Toronto’s under-50 population saw a decline in homeownership due to weak economic growth, high unemployment, and high interest rates.”

Young adults are finding it to be more and more difficult to afford a home in Toronto, often relying on parents or relatives if they’re able to enter the market at all. With only a handful of homes under $1 million left on the market, the idea of a “starter home” is becoming increasingly far-fetched.

It seems that nothing is helping to bring prices down — not even the conditions of a market dictated by high interest rates. In May, listings were up 21.1 per cent year-over-year, and home sales declined for the fourth consecutive month. Still, the average selling price was down just 2.5 per cent year-over-year.