In some respects, Katrina Armstrong has chosen to have a family over owning a family home.

She and her husband, who share a two-bedroom rented apartment in a leafy, west-end Toronto neighbourhood with their 18-month-old son, had envisioned buying a house that they could someday leave to their children.

But despite their “above average” household income — she works as an online projects manager; he juggles several serving jobs — the 33-year-old said they expect to rent for as long as they stay in Toronto.

“We want to expand our family, and that adds to it,” she said. “Unless we actually started playing the lottery and won it, I don’t foresee us ever buying a home.”

This is the bizarre irony facing many families in Canada’s major urban centres as new figures show that it’s gotten even harder for average Canadians to afford a family house, despite evidence of a downturn in the market.

PHOTOS: THE 10 LEAST AFFORDABLE CITIES FOR HOUSING

Amid talk of a buyer’s market and signs of cooling condo sales, a report from Royal Bank of Canada released Monday shows that affordability is eroding in the segments of the market most sought after by families — a trend that senior economist Robert Hogue said will force many young people to adjust their expectations.

“Especially for first-time buyers, many of them cannot afford a two-storey home or bungalow the way that previous generations have been able to,” he told The Huffington Post. “The market has shifted toward condominiums as the entry level for home ownership. Those trends are there to stay.”

As Hogue explains, while active cranes in many downtown areas signal a still-growing supply of condos, the opposite is true of single-detached family homes, as a lack of construction — and, in cities like Toronto and Vancouver, a finite amount of space on which to build — has pushed prices upward.

The RBC housing trends report found that detached bungalows became 0.2 percentage points less affordable in Canada over the past three months, pushing home ownership costs to 43.4 per cent of household income. For two-storey homes, affordability declined by 0.6 percentage points, increasing ownership costs to nearly half of household income.

The measure for condos remained flat at 28.8 per cent.

PHOTOS: WHICH PARTS OF CANADA HAVE THE HIGHEST HOUSEHOLD DEBT?

The RBC report marks the second straight quarterly decrease in affordability across all housing segments in Canada, following back-to-back quarterly increases in affordability during the last two quarters of 2011.

Although in Vancouver, home sales are dropping and price increases have tempered, the report still pegged the coastal city as “by far the least affordable market” as the bank’s affordability measures “deteriorated for all house types … to levels that stood very close to the worst on record.”

But while excluding the Vancouver market would bring the affordability of bungalows much closer in line with historical averages, RBC found that this would make “little difference” for two-storey homes, a further indication of just how out-of-reach the prototypical family house has become.

The decline in affordability of two-storey homes was observed throughout the country. In Saskatchewan, for instance, affordability in this category plummeted by 2.8 per cent, while in Manitoba, affordability fell by 1.6 per cent.

According to Vancouver-based real-estate agent Sarah Daniels, the recent tightening of mortgage restrictions, which reduced the maximum amortization period for government-insured mortgages to 25 from 30 years, has made it even more difficult for first-time buyers with smaller down-payments to break in.

“That does drastically change things for them,” she said.

But while market forces may be pushing potential homeowners to condos, some are more reluctant than others.

“Growing up in a house has really affected my expectations,” said Jean Farrugia, who has been house-hunting without success in Toronto for the past five months.

Although some of her friends, disenchanted by high prices and bidding wars, have settled for a condo, the 31-year-old said she holds out hope for a family home, where she feels she can best build a life with her partner — even it means moving out of the city.

“It’s hard for me to wrap my head around owning a box in another box,” she said. “I don’t feel like you own anything when you own a condo.”

WHICH PARTS OF CANADA HAVE THE HIGHEST HOUSEHOLD DEBT?

Loading Slideshow...
  • Canadian Household Debt By Region

  • 6. Atlantic Canada: $69,300

    Number represents the average among those households that carry debt. Source: <a href="http://www.statcan.gc.ca/pub/75-001-x/2012002/article/11636-eng.pdf" target="_hplink">Statistics Canada</a>

  • 5. Quebec: $78,900

    Number represents the average among those households that carry debt. Source: <a href="http://www.statcan.gc.ca/pub/75-001-x/2012002/article/11636-eng.pdf" target="_hplink">Statistics Canada</a>

  • 4. Manitoba & Saskatchewan: $84,900

    Number represents the average among those households that carry debt. Source: <a href="http://www.statcan.gc.ca/pub/75-001-x/2012002/article/11636-eng.pdf" target="_hplink">Statistics Canada</a>

  • 3. Ontario: $124,700

    Number represents the average among those households that carry debt. Source: <a href="http://www.statcan.gc.ca/pub/75-001-x/2012002/article/11636-eng.pdf" target="_hplink">Statistics Canada</a>

  • 2. British Columbia: $155,500

    Number represents the average among those households that carry debt. Source: <a href="http://www.statcan.gc.ca/pub/75-001-x/2012002/article/11636-eng.pdf" target="_hplink">Statistics Canada</a>

  • 1. Alberta: $157,700

    Number represents the average among those households that carry debt. Source: <a href="http://www.statcan.gc.ca/pub/75-001-x/2012002/article/11636-eng.pdf" target="_hplink">Statistics Canada</a>

  • Also On HuffPost:

    THE 10 COUNTRIES DEEPEST IN DEBT

  • 10. United Kingdom

    <strong>Debt as a percentage of GDP:</strong> 80.9 percent <strong>General government debt:</strong> $1.99 trillion <strong>GDP per capita (PPP):</strong> $35,860 <strong>Nominal GDP:</strong> $2.46 trillion <strong>Unemployment rate:</strong> 8.4 percent <strong>Credit rating:</strong> Aaa Although the UK has one of the largest debt-to-GDP ratios among developed nations, it has managed to keep its economy relatively stable. The UK is not part of the eurozone and has its own independent central bank. The UK's independence has helped protect it from being engulfed in the European debt crisis. Government bond yields have remained low. The country also has retained its Aaa credit rating, reflecting its secure financial standing. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 9. Germany

    <strong>Debt as a percentage of GDP:</strong> 81.8 percent <strong>General government debt:</strong> $2.79 trillion <strong>GDP per capita (PPP):</strong> $37,591 <strong>Nominal GDP:</strong> $3.56 trillion <strong>Unemployment rate:</strong> 5.5 percent <strong>Credit rating:</strong> Aaa As the largest economy and financial stronghold of the EU, Germany has the most interest in maintaining debt stability for itself and the entire eurozone. In 2010, when Greece was on the verge of defaulting on its debt, the IMF and EU were forced to implement a 45 billion euro bailout package. A good portion of the bill was footed by Germany. The country has a perfect credit rating and an unemployment rate of just 5.5 percent, one of the lowest in Europe. Despite its relatively strong economy, Germany will have one of the largest debt-to-GDP ratios among developed nations of 81.8 percent, according to Moody's projections. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 8. France

    <strong>Debt as a percentage of GDP:</strong> 85.4 percent <strong>General government debt:</strong> $2.26 trillion <strong>GDP per capita (PPP):</strong> $33,820 <strong>Nominal GDP:</strong> $2.76 trillion <strong>Unemployment rate:</strong> 9.9 percent <strong>Credit rating:</strong> Aaa France is the third-biggest economy in the EU, with a GDP of $2.76 trillion, just shy of the UK's $2.46 trillion. In January, after being long-considered one of the more economically stable countries, Standard & Poor's downgraded French sovereign debt from a perfect AAA to AA+. This came at the same time eight other euro nations, including Spain, Portugal and Italy, were also downgraded. S&P's action represented a serious blow to the government, which had been claiming its economy as stable as the UK's. Moody's still rates the country at Aaa, the highest rating, but changed the country's outlook to negative on Monday. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 7. United States

    <strong>Debt as a percentage of GDP:</strong> 85.5 percent <strong>General government debt:</strong> $12.8 trillion <strong>GDP per capita (PPP):</strong> $47,184 <strong>Nominal GDP:</strong> $15.13 trillion <strong>Unemployment rate:</strong> 8.3 percent <strong>Credit rating:</strong> Aaa U.S. government debt in 2001 was estimated at 45.6 percent of total GDP. By 2011, after a decade of increased government spending, U.S. debt was 85.5 percent of GDP. In 2001, U.S. government expenditure as a percent of GDP was 33.1 percent. By 2010, is was 39.1 percent. In 2005, U.S. debt was $6.4 trillion. By 2011, U.S. debt has doubled to $12.8 trillion, according to Moody's estimates. While Moody's still rates the U.S. at a perfect Aaa, last August Standard & Poor's downgraded the country from AAA to AA+. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 6. Belgium

    <strong>Debt as a percentage of GDP:</strong> 97.2 percent <strong>General government debt:</strong> $479 billion <strong>GDP per capita (PPP):</strong> $37,448 <strong>Nominal GDP:</strong> $514 billion <strong>Unemployment rate:</strong> 7.2 percent <strong>Credit rating:</strong> Aa1 Belgium's public debt-to-GDP ratio peaked in 1993 at about 135 percent, but was subsequently reduced to about 84 percent by 2007. In just four years, the ratio has risen to nearly 95 percent. In December 2011, Moody's downgraded Belgium's local and foreign currency government bonds from Aa1 to Aa3. In its explanation of the downgrade, the rating agency cited "the growing risk to economic growth created by the need for tax hikes or spending cuts." In January of this year, the country was forced to make about $1.3 billion in spending cuts, according to The Financial Times, to avoid failing "to meet new European Union fiscal rules designed to prevent a repeat of the eurozone debt crisis." <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 5. Portugal

    <strong>Debt as a percentage of GDP:</strong> 101.6 percent <strong>General government debt:</strong> $257 billion <strong>GDP per capita (PPP):</strong> $25,575 <strong>Nominal GDP:</strong> $239 billion <strong>Unemployment rate:</strong> 13.6 percent <strong>Credit rating:</strong> Ba3 Portugal suffered greatly from the global recession -- more than many other countries -- partly because of its low GDP per capita. In 2011, the country received a $104 billion bailout from the EU and the IMF due to its large budget deficit and growing public debt. The Portuguese government now "plans to trim the budget deficit from 9.8 percent of gross domestic product in 2010 to 4.5 percent in 2012 and to the EU ceiling of 3 percent in 2013," according Business Week. The country's debt was downgraded to junk status by Moody's in July 2011 and downgraded again to Ba3 on Monday. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 4. Ireland

    <strong>Debt as a percentage of GDP:</strong> 108.1 percent <strong>General government debt:</strong> $225 billion <strong>GDP per capita (PPP):</strong> $39,727 <strong>Nominal GDP:</strong> $217 billion <strong>Unemployment rate:</strong> 14.5 percent <strong>Credit rating:</strong> Ba1 Ireland was once the healthiest economy in the EU. In the early 2000s, it had the lowest unemployment rate of any developed industrial country. During that time, nominal GDP was growing at an average rate of roughly 10 percent each year. However, when the global economic recession hit, Ireland's economy began contracting rapidly. In 2006, the Irish government had a budget surplus of 2.9 percent of GDP. In 2010, it accrued a staggering deficit of 32.4 percent of GDP. Since 2001, Ireland's debt has increased more than 500 percent. Moody's estimates that the country's general government debt was $224 billion, well more than its GDP of $216 billion. Moody's rates Ireland's sovereign debt at Ba1, or junk status. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 3. Italy

    <strong>Debt as a percentage of GDP:</strong> 120.5 percent <strong>General government debt:</strong> $2.54 trillion <strong>GDP per capita (PPP):</strong> $31,555 <strong>Nominal GDP:</strong> $2.2 trillion <strong>Unemployment rate:</strong> 8.9 percent <strong>Credit rating:</strong> A3 Italy's large public debt is made worse by the country's poor economic growth. In 2010, GDP grew at a sluggish 1.3 percent. This was preceded by two years of falling GDP. In December 2011, the Italian government passed an austerity package in order to lower borrowing costs. The Financial Times reports that according to consumer association Federconsumatori, the government's nearly $40 billion package of tax increases and spending cuts will cost the average household about $1,500 each year for the next three years. On Monday, Moody's downgraded Italy's credit rating to A3, from A2. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 2. Greece

    <strong>Debt as a percentage of GDP:</strong> 168.2 percent <strong>General government debt:</strong> $489 billion <strong>GDP per capita (PPP):</strong> $28,154 <strong>Nominal GDP:</strong> $303 billion <strong>Unemployment rate:</strong> 19.2 percent <strong>Credit rating:</strong> Ca Greece became the poster child of the European financial crisis in 2009 and 2010. After it was bailed out by the rest of the EU and the IMF, it appeared that matters could not get any worse. Instead, Greece's economy has continued to unravel, prompting new austerity measures and talks of an even more serious default crisis. In 2010, Greece's debt as a percent of GDP was 143 percent. Last year, Moody's estimates Greece's debt increased to 163 percent of GDP. Greece would need a second bailout worth 130 billion euro -- the equivalent of roughly $172 billion -- in order to prevent the country from defaulting on its debt in March. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>

  • 1. Japan

    <strong>Debt as a percentage of GDP:</strong> 233.1 percent <strong>General government debt:</strong> $13.7 trillion <strong>GDP per capita (PPP):</strong> $33,994 <strong>Nominal GDP:</strong> $5.88 trillion <strong>Unemployment rate:</strong> 4.6 percent <strong>Credit rating:</strong> Aa3 Japan's debt-to-GDP ratio of 233.1 percent is the highest among the world's developed nations by a large margin. Despite the country's massive debt, it has managed to avoid the type of economic distress affecting nations such as Greece and Portugal. This is largely due to Japan's healthy unemployment rate and population of domestic bondholders, who consistently fund Japanese government borrowing. Japanese vice minister Fumihiko Igarashi said in a speech in November 2011 that "95 percent of Japanese government bonds have been financed domestically so far, with only 5 percent held by foreigners." Prime Minister Yoshihiko Noda has proposed the doubling of Japan's 5 percent national sales tax by 2015 to help bring down the nation's debt. <a href="http://247wallst.com/2012/02/14/the-tencountries-deepest-in-debt/#ixzz1mSdyJAeo" target="_hplink">Read more at 24/7 Wall St.</a>




THE 10 LEAST AFFORDABLE CITIES FOR HOUSING

Loading Slideshow...
  • 10: New York City - 6.2

    The number shown is the housing affordability ratio -- a measure that shows how much a median home costs relative to median incomes in a given city. Historically, a typical ratio has been around three. Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • 9: Auckland, New Zealand - 6.4

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • Adelaide, Australia - 6.7

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • San Francisco - 6.7

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • London - 6.9

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • San Jose, California - 6.9

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • Melbourne, Australia - 8.4

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • Sydney - 9.2

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • Vancouver - 10.6

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

  • Hong Kong - 12.6

    Source: Demographia, <a href="http://www.demographia.com/dhi.pdf" target="_hplink"><em>8th Annual International Housing Affordability Survey</em></a>

Loading Slideshow...
  • Vancouver - $299,999

    #302-2333 ETON ST Building Type : Apartment Bedrooms : 2 Bathrooms : 1 Floor Space : 765 sqft Storeys : 1 Built in : 1988 Title : Condominium/Strata Maintenance Fees : $287.53 Monthly

  • Vancouver - $299,999

    #302-2333 ETON ST

  • Vancouver - $299,999

    #302-2333 ETON ST

  • Vancouver - $199,999

    1640 KENT AV Building Type : House Bedrooms : 1 Bathrooms : 2 Floor Space : 860 sqft Storeys : 2 Built in : 1993

  • Vancouver - $199,999

    1640 KENT AV

  • Vancouver - $199,999

    1640 KENT AV

  • Richmond - $299,900

    #3-8400 COOK RD Building Type : Apartment Bedrooms : 1 Bathrooms : 1 Floor Space : 607 sqft Storeys : 1 Built in : 2010 Title : Condominium/Strata

  • Richmond - $299,900

    #3-8400 COOK RD

  • Surrey - $300,000

    #A4-19296 72A AVE Building Type : Row / Townhouse Bedrooms : 3 Bathrooms : 4 Floor Space : 1298 sqft Storeys : 3 Built in : 2012 Title : Condominium/Strata

  • Surrey - $300,000

    #A4-19296 72A AVE

  • Surrey - $300,000

    #A4-19296 72A AVE

  • Whistler - $299,000

    #6-2720 CHEAKAMUS WY Building Type : Row / Townhouse Bedrooms : 1 Bathrooms : 1 Floor Space : 668 sqft Storeys : 1 Built in : 1998 Title : Condominium/Strata

  • Whistler - $299,000

    #6-2720 CHEAKAMUS WY

  • Whistler - $299,000

    #6-2720 CHEAKAMUS WY

  • Prince George - $299,900

    3049 RIDGEVIEW DR Building Type : House Bedrooms : 4 Bathrooms : 3 Floor Space : 2274 sqft Storeys : 4 Built in : 1977 Land Size : 0.28 ac Title : Freehold

  • Prince George - $299,900

    3049 RIDGEVIEW DR

  • Prince George - $299,900

    3049 RIDGEVIEW DR

  • Kamloops - $299,900

    814-15 HUDSONS BAY TRAIL Building Type : Row / Townhouse Bedrooms : 3 Bathrooms : 3 Floor Space : 1904 sqft Title : Freehold

  • Kamloops - $299,900

    814-15 HUDSONS BAY TRAIL

  • Kamloops - $299,900

    814-15 HUDSONS BAY TRAIL

  • Kelowna - $299,900

    1881 Ambrosi Road # 10 Bedrooms : 2 Bathrooms : 2 Floor Space : 1174 sqft Storeys : 2 Built in : 2012 Land Size : under 1 acre Title : Condominium/Strata Maintenance Fees : $121.74 Monthly

  • Kelowna - $299,900

    1881 Ambrosi Road # 10

  • Kelowna - $299,900

    1881 Ambrosi Road # 10

  • Nelson - $309,000

    304 HIGH ST Building Type : House Bedrooms : 3 Bathrooms : 1 Floor Space : 1148 sqft Storeys : 2 Built in : 9999 Land Size : 0.163 ac

  • Nelson - $309,000

    304 HIGH ST

  • Nelson - $309,000

    304 HIGH ST

  • Cranbrook - $299,900

    203 S 8TH ST Building Type : House Bedrooms : 4 Bathrooms : 3 Floor Space : 2170 sqft Storeys : 1 Built in : 1994

  • Cranbrook - $299,900

    203 S 8TH ST

  • Cranbrook - $299,900

    203 S 8TH ST

  • Abbotsford - $302,900

    #11-31255 UPPER MACLURE RD Building Type : Row / Townhouse Bedrooms : 3 Bathrooms : 2 Floor Space : 1186 sqft Storeys : 2 Built in : 1992

  • Abbotsford - $302,900

    #11-31255 UPPER MACLURE RD

  • Abbotsford - $302,900

    #11-31255 UPPER MACLURE RD

  • Prince Rupert - $299,000

    1541 OVERLOOK ST Building Type : House Bedrooms : 5 Bathrooms : 3 Floor Space : 2300 sqft Storeys : 3 Built in : 1968 Land Size : 0.229 ac

  • Prince Rupert - $299,000

    1541 OVERLOOK ST

  • Prince Rupert - $299,000

    1541 OVERLOOK ST

  • Smithers - $309,500

    4314 JACKPINE RD Building Type : House Bedrooms : 5 Bathrooms : 2 Floor Space : 2434 sqft Storeys : 4 Built in : 1996 Land Size : 5 ac

  • Smithers - $309,500

    4314 JACKPINE RD

  • Smithers - $309,500

    4314 JACKPINE RD

  • Kitimat - $299,000

    96 ANDERSON ST Building Type : House Bedrooms : 4 Bathrooms : 3 Floor Space : 2300 sqft Storeys : 2 Built in : 1974 Land Size : 0.186 ac

  • Kitimat - $299,000

    96 ANDERSON ST

  • Kitimat - $299,000

    96 ANDERSON ST

  • Victoria - $299,900

    304-751 Goldstream Ave Building Type : Apartment Bedrooms : 2 Bathrooms : 2 Floor Space : 1030 sqft Built in : 2010 Land Size : 1113 sqft View : City view Title : Condominium/Strata

  • Victoria - $299,900

    304-751 Goldstream Ave

  • Victoria - $299,900

    304-751 Goldstream Ave

  • Nanaimo - $299,900

    1691 NAIRNE ROAD Building Type : House Bedrooms : 4 Bathrooms : 2 Floor Space : 1870 sqft Built in : 1967 Land Size : irregular Title : Freehold

  • Nanaimo - $299,900

    1691 NAIRNE ROAD

  • Nanaimo - $299,900

    1691 NAIRNE ROAD

  • Cortes Island - $279,000

    1411 ROBERTSON ROAD Building Type : House Bedrooms : 2 Bathrooms : 1 Floor Space : 1116 sqft Built in : 1975 Land Size : 2.71 ac Title : Freehold

  • Cortes Island - $279,000

    1411 ROBERTSON ROAD

  • Cortes Island - $279,000

    1411 ROBERTSON ROAD

  • Dawson Creek - $279,000

    1552 109 AVE Building Type : House Bedrooms : 4 Bathrooms : 2 Floor Space : 1100 sqft Storeys : 1.5 Built in : 1962 Land Size : 73 X 130 Title : Freehold