Vancouver – Gas prices in Vancouver hit a new high of more than $2.39 a litre at some stations Thursday, blowing past the previous peak set this summer.

One gas analyst said that’s a new all-time record for North America, and expects prices to continue to rise this week.

Dan McTeague, president of Canadians for Affordable Energy, said prices passed the previous record of nearly $2.37 a litre, set in Vancouver in June, due to the temporary shutdown of refineries in the U.S. Pacific Northwest and California.

McTeague said prices will likely rise again then drop fairly quickly once the supply issues are resolved.

“I don’t see the all-clear light at the end of the tunnel just yet. It’s going to happen and when it does it will be a dramatic drop, probably about 20 cents a litre, not in one fell swoop but very close to that over two or three days,” he said.

Gas prices jumped overnight across Canada by almost 20 cents in some places.

McTeague said no one could have predicted gas prices increasing at the speed they have over the past several days.

“The bottom line is that there’s not enough supply out there and however we got here, we’re going to have to spend a bit more time trying to figure this out because this is the kind of things that bring economies to a standstill,” he said.

According to the CAA’s price tracker, gas is up nationally by just over three cents on average at $1.58 per litre, with some provinces seeing higher jumps than others.

The CAA says the average gas price across Vancouver was $2.32 on Thursday.

This report by The Canadian Press was first published Sept. 29, 2022.

By Nojoud Al Mallees in Ottawa

Buying a home has become more unaffordable for Canadians even as housing prices fall, according to new reports from the parliamentary budget officer and RBC.

The PBO’s house price assessment, published on Thursday, says the cost of the average house is 67 per cent higher than what the average household can afford — and RBC’s own report says the median household would need to spend 60 per cent of its income on ownership costs.

That’s despite a seven per cent decline in housing prices from February to August this year.

According to the budget officer, the average national home price in February was more than 50 per cent higher than it was two years before.

The national average price of a home reached a peak of $839,600 in February 2022, up 52 per cent from $551,100 in February 2020.

Since then, prices have declined by seven per cent, down to $777,200 in August.

But with interest rates on the rise, buying a home remains highly unaffordable for the average household, the assessment says.

Using a methodology developed by the International Monetary Fund that examines household borrowing capacity and the ability to purchase a home in select Canadian cities, the PBO says a house considered affordable for an average household in August would cost $464,952.

The national average home price was 67 per cent higher.

The gap has gotten larger since December 2021, when the national average house price was about 45 per cent more expensive than what an average household could afford, according to the budget officer.

The RBC report, also published Thursday, says buying a home has never been this unaffordable, per its own affordability measures.

RBC says the median Canadian household would need to spend 60 per cent of its income to cover ownership costs. For those who live in Toronto and Vancouver, the figure balloons to 83 per cent and 90 per cent, respectively.

Both RBC and budget officer Yves Giroux attribute the worsening of the situation to higher mortgage costs, as the Bank of Canada aggressively raises interest rates to cool high inflation.

Since March, the central bank has hiked its key interest rate by three percentage points. Its key rate currently sits at 3.25 per cent and another interest rate hike is expected in October.

The rate hikes are feeding into higher borrowing costs for those seeking a mortgage and, in turn, a slowdown in the housing market.

“The Bank of Canada’s rate hiking campaign since March has added hundreds of dollars to mortgage payments that come with a home purchase,” the RBC report says.

RBC expects affordability issues to peak by the end of the year. As house prices continue to fall and interest rates eventually stabilize, the bank expects affordability to improve.

“The good news is the widespread market downturn is setting the stage for some affordability improvement down the road,” the report says.

Based on scenarios the PBO constructed to gauge where housing prices are headed, prices could decline by 12 to 23 per cent by the end of the year from the peak reached in the winter.

This report by The Canadian Press was first published Sept. 29, 2022.