Thank you for that question.
My parents bought their first home in 1970. My dad was an HVAC mechanic, and when they bought that home it cost about less than three times their income. When I bought our first home in 2004, it was the same story: It was about three times my wife's and my combined incomes, and we were in our late twenties at the time. Nowadays across Canada, depending on the community, we're close to six to 10 times.
There are a number of factors, two in particular, I would point to.
One is the massive rise in taxes, charges and fees. In the city of Toronto, for instance, development charges are up over 5,000% since the year 2000. If other prices in our economy had gone up that much, a cup of coffee would cost about $66, and a small, family-sized sedan would be about $1.3 million. That's a key point.
The next cost that has risen a lot is the cost of land. We've had a lot of restrictions on land use. Municipal governments have made it difficult to build up—particularly family-sized homes—but have also prevented building out. If you can't build up and you can't build out, that's going to make land very expensive.
Finally, we've had a lot of population growth over the last five to 10 years, which requires more use of land and more homes to be built. When we don't allow for that, it also raises the price.
There are many factors, but those are the three I would point out as having caused the price-to-income ratio of housing to rise so significantly in the last 20 years.