06:55 AM EDT, 03/27/2025 (MT Newswires) -- Canadian housing affordability improved for the fifth

consecutive quarter in Q4 2024, according to the Bank of Canada's measure, noted Bank of Montreal (BMO).

Still, that's only after reaching one of the worst levels on record in the middle of 2023, and affordability is worse than in Q1 2022 -- when home prices hit their peak, and just as interest rates were about to start rising, said the bank.

The combination of falling rates, stable home prices, and

moderate income gains have helped modestly improve the

affordability picture, stated BMO. However, there is still "a long way to go" before affordability is back to anything close to normal.

Contrary to conventional wisdom, the brutal deterioration in national affordability is actually quite recent -- things really

only got out of hand in 2021, pointed out the bank. Pre-pandemic affordability was only slightly worse than normal.

One potential source of relief is the recent pullback in

population growth, added BMO. From the fiery 3.25% year-over-year peak a year ago, it has cooled to 1.8% year over year in the latest quarter and about 1% on a seasonally adjusted quarter-over-quarter annualized rate.

Population growth is not the only factor at play, but arguably it was a huge factor in 2021/23, according to the bank.