If you find yourself broke and struggling at the end of the month after paying your too-high rent price, you're not alone. In fact, almost half of Canadians are feeling the pinch, according to a recent study.
A survey, conducted by RateSupermarket.ca, revealed that 44% of Canadians can barely afford their rent and are overspending on rent prices. Also, 20% of homeowners are spending more than half of their monthly income on the associated costs of owning a home.
According to the Canadian Mortgage and Housing Corporation, the suggested amount of monthly income any one person should be spending on housing is less than a third. After, you're at risk for serious financial problems. The same study concluded that 15% of Canadians are spending more than half their income on rent alone.
These alarming numbers indicate a disturbing trend when it comes to affordable living. Despite the fact that less than 1% of Canadians can afford to purchase a home in Vancouver, you could always rely on renting. Now, even that's becoming prohibitive.
When looking at the numbers on a city-by-city basis, the picture becomes clear — renting in Canada has never been more expensive.
According to new data from Padmapper, the average price of a 1 bedroom apartment in Toronto is now $2,230/month; Vancouver – $2,210/month; Montreal – $1,430/month.
Montreal, in particular, experienced a near 15% increase in average rent prices in one year, something that was never expected.
Overspending on rent is worst in Toronto and Montreal where a third of each city's population can barely afford their rent. Yet, Canadians under the age of 55 spend more on housing than any other generation.
Eventually, renters ought to make a transition into homeowning, but there are countless budgetary obstacles that exist nowadays.
Renters often need to stretch their budget to afford their first home yet 40% responded that they would consider buying a home in the near future.
To make matters worse, house prices are increasing just as quickly as rent prices in some cities. Low vacancy rates create high competition which drives up prices. In Vancouver, for example, the average price of a home is $1.4 million.
As rent prices continue to go up, some of the most vulnerable Canadians will be left scrambling to find an affordable living situation.
Montreal, for its part, is trying to curb the effects of overspending.
It's an uphill battle for those who belong in this category of renters. If some Canadians want to eventually own a house, they should be prepared for some serious budgeting.
To read the complete RateSupermarket.ca study, click here.
To see what the average rent prices are like in your city, check out Padmapper.