Honestly, every major "big 3" city suffers a bit of what Zekes mentioned in terms of cost. Toronto and Montreal are suffering from increased renting costs. I think we're up to nearly $2000/mo on average here, maybe a couple hundred less for a 1-bedroom condo. Be sure to take into account the fact that we pay a significant amount more for Internet/phone and such than y'all do.
Nah, but I figured maybe if you live in a more northern state it'd make life easy. I guess flights are a little cheaper, and you can more easily capitalize on deals only available on the US. I'll drive into Buffalo to pick something up on the cheap for instance.
I regret to inform you the only place you won't really suffer from this is BC.
-snip
Weird suggestion, but have you looked to Moncton/Fredericton?
If you're good with that, you can live on the outside of the GTA and stay within your budget.
E: You can find something here on the east or west end (Scarborough or Etobicoke), that's city housing, and the max you'll pay is like $1100. They get bad reps, but it's better than shelling out for private owned options and co-op, so.