Have you scratched your head and asked yourself recently "how could the Toronto housing market climb any higher any faster?" The chief economist at the National Bank recently gave some critical facts backing up his belief that the Toronto and Vancouver housing prices are in fact warranted.

1) The working age population (20-44 years old) is growing 70% faster in Toronto and Vancouver than the rest of the country – wouldn't we all like to retire at 45!

2) Employment rates increased by 5.5% in Toronto and 4.4% in Vancouver in 2015 while nationwide job growth was a mere 0.9%.

3) The price-to-income ratio for a 950 square foot condo in Canada's largest cities are lower than other major cities around the world. For example take a $600,000 condo and divide that by the average single person income of $50,000 per year, the price-to-income ratio would be 12. The higher the price of the condo, the greater this value will be,
Toronto and Vancouver (>10)
San Francisco (>15)
London, Beijing, Hong Kong (>35)

Home prices in Vancouver increased 22% year over year in February and 15% in Toronto. It is possible that these increases are to compensate for the fact that we were undervalued for years prior.