As house prices rise at what the Bank of Canada calls a “fire-breathing” pace, Canadians are growing increasingly worried about home affordability, particularly in the Toronto and Vancouver areas. But here’s a sobering thought, courtesy a new report from National Bank Financial: Affordability could be worse. Way, way worse. (Click chart for full size)

Chart: National Bank Financial Economists Matthieu Arseneau and Kyle Dahms published the above chart in a report issued Friday, showing how Canada’s three largest metro areas compare to 15 major cities in Europe, North America and the Asia-Pacific region. By this measure, downtown housing is far more affordable in Canada’s major cities than it is in London, Tokyo, Hong Kong, Rome, New York, Paris, or even Stockholm and Vienna.

A view of Robson Street in downtown Vancouver. Condo prices in the city's core are still more affordable than in many major cities. (Photo: Getty Images) In Beijing and Hong Kong, a 970-square-foot condo will run you 34.7 times the city’s average income. Compare that to Canada’s least affordable city, Vancouver, where that same condo will cost you 11.3 times average income. Canadian affordability levels are similar to levels seen in Australia, which has a similar resource-based economy to Canada's.

Vancouver is no Beijing: The capital city of China has affordability issues beyond the nightmares of Canadians. (Photo: Linghe Zhao via Getty Images) There are some shortcomings with this comparison: For one, it looks only at downtown condo prices, so we have no idea how single-family homes or suburbs compare. And it's exactly those parts of the Toronto and Vancouver housing markets that have seen the sharpest rise in prices in the past few years. For another, the cities on this list might actually be in the midst of a major global housing bubble, as some observers have controversially argued, a bubble created by extremely low (even negative) interest rates worldwide.

Home affordability has deteriorated considerably in Vancouver, Toronto and Hamilton over the past year. It has improved in Montreal, Calgary, Edmonton, Quebec City and Winnipeg. (Chart: National Bank Financial) Just because a market has room to grow doesn’t necessarily mean it will. The Canadian Real Estate Association (CREA) reported Friday that home sales in Canada peaked in April and have fallen for the past two consecutive months. At the same time, new listings are up, suggesting that the market is becoming slightly more favourable to buyers and less favourable to sellers. Still, the amount of housing inventory on the market is at six-year lows, “reflecting increasingly tighter housing markets in B.C. and Ontario."