Vancouver third most unaffordable city, says international housing survey

Housing prices in Vancouver are “severely unaffordable”, says a new report.

For the third quarter of 2010, the city had a median house price of $602,000 and a median household income of $63,100, according to the 7th annual Demographia International Housing Affordability Survey.

Those numbers earned Vancouver the description of least affordable housing market in Canada in the survey, which looked at affordability in 325 centres around the world.

The city also placed third to last in the survey’s international housing affordability ranking, right above Hong Kong and Sydney.

The numerical ratings are based on the “median multiple” method, which divides median house price by gross annual median household income.

A market’s housing prices are considered “affordable” if they are no more than three times above the household income level: a rating of 3.0 or less.

A rating of 5.1 or more is considered “severely unaffordable”.

Vancouver, which received a rating of 9.5, is among four markets in B.C. described as severely unaffordable. The other three include Victoria (7.1), Abbotsford (6.5), and Kelowna (5.9).

Of the 35 markets in Canada covered in the survey, nine are affordable, 17 are moderately affordable, three are seriously unaffordable, and six are severely unaffordable.

“Housing in Canada is moderately unaffordable with a median multiple of 4.6 in major metropolitan markets and 3.4 overall,” the report says. “Housing was generally affordable in Canada as late as 2000.”

The survey was released on January 24 by the Frontier Centre for Public Policy, a Winnipeg-based research group.

Other than Canada, markets in Australia, Hong Kong, Ireland, New Zealand, the United Kingdom, and the United States were included.

“Housing affordability was little changed in 2010, with the most affordable markets being in the United States and Canada,” the report says.

“The United Kingdom, Australia and New Zealand continue to experience pervasive unaffordability.”

Comments

17 Comments

Chet

Jan 25, 2011 at 8:51pm

Vancouver is also Home to whiners n Elitist Hogs

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Todd

Jan 25, 2011 at 9:37pm

That's what filthy government subsidies always do. Read de Jouvenal's account of post-WWII Paris, and the crap housing that followed there for decades. NYC as well, during the 70's and 80's.

As always, government is the problem.

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really?

Jan 25, 2011 at 10:30pm

Wonder if the foreign investors paying $1.6 million for a house only to tear it down to build a palace has anything to do with it. As far as I'm concerned, if you weren't born here and don't work here, take your stinking foreign money and shove it.

It distresses me to no end that "investors” are making it unaffordable for Canadians who are struggling to buy a shack here because Canadians can’t compete with foreign investors with a few million dollars of blood money from corrupt countries. Remember what happened to the aristocrats in France? Get lost before the same happens to you!

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Second Nation

Jan 26, 2011 at 6:15am

Can't afford it then look somewhere else.

Do you use the same whine at the supermarket? "These tomatoes are too expensive! It's because other people are paying full price for them! I only want to pay 20% of the listed price! Waaahhhh!"

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Scott Blackstone

Jan 26, 2011 at 7:43am

This is news? Of course prices in Vancouver are over-inflated. That's what happens when you choke development and reduce interest rates to nothing. You could easily build a few Olympic-village sized housing developments on the Jericho park lands that could house maybe 100,000-150,000 people and half the cost of housing in this city; but municipal and federal policy is "as high housing prices as possible"

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Fan'o Truth

Jan 26, 2011 at 8:02am

Many Vancouverites interpret these high prices as a mark of economic success. They're not about to do anything that would bring about lower prices since to do so would involve reducing their own wealth.

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poppi

Jan 26, 2011 at 9:09am

The rich foriegn investors ie; HK and China have priced everybody out of the market.Canada is a land of immigrants and I too am an immigrant but coming as I do from the UK,I will need to return home because of the housing market.I must live somewhere and I am not prepared to pay $6-700,000 for a moderately decent house made of wood.Its ridiculous.I also do not understand why UK university degrees and qualifications are overlooked in the job market yet they are fully acceptable and indeed coveted by the immigration procedures.You apply for a job and they will glaze over your UK 4 year university because you do not have such and such a course that costs approx $9000 for 4 months.Okay,you may do that course and spend that money but then there is nothing to say that the job is yours.Any job of substance you apply for requires some small diploma thats only applicable to BC.Seriously you would need to spend your life doing diploma after diploma whereas in the UK a degree and higher counts and overides all.Work experience counts and you may enhance your prospects with ongoing,on the job courses but those small courses will not be the main criteria.The university degree is the main criteria.

I hate to say this but Ontario is being filled with the flotsom and jetsom and BC is beyond any reasonable attainment.I love Canada but not so much that I want to drown in debt for a wooden shack of a place.I would rather stay in the UK where the houses are expensive but they retain their value because they are built of brick.Where education counts for something and society is socially concerned.

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Ryboy

Jan 26, 2011 at 3:58pm

Mortgage fraud on a massive scale. When you look at the numbers, nobody should be able to afford a home at those median costs. People are lying on their mortgage applications and the banks don't care. As long as the prices keep escalating, the party won't end.

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Vancouver ex-pat

Jan 26, 2011 at 4:55pm

Vancouver and BC has been run by and for property developers since the 80s. Before Gordon Campbell was premier of BC, he was mayor of Vancouver, and before that he was a property developer. His colleges are property developers. The entire time he was in city hall and then in Victoria, he was working in the interests of property developers. Property developers were the main contributors to and lobby for the 2010 Olympic bid and the Expo 86 bid. People who have owned a house in Vancouver since the 80's convince themselves that they are shrewd investors while they defer their taxes and rack up their line of credit. Vancouver's and BC's economy is fuelled by consumer debt in the form of equity lines of credit, secured against over valued real-estate. One of Vancouver's and BC's largest industries is developers selling real estate debt to suckers. It was good timing for Campbell to resign when he did - before the bubble bursts.

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Lee Ving

Jan 26, 2011 at 11:49pm

The Vancouver residential real estate market is the financial laundromat of Chinese communist money and BC drug money.

Do you know what the per capita income is in China? It is USD $3,678. See this link: http://www.state.gov/r/pa/ei/bgn/18902.htm . The Chinese who can afford to buy homes in Vancouver are communist party members who get rich filtering money from hard working Chinese workers and putting the funds in their pockets. When the communist members worry about repercussions within China, they simple get the money into politically correct Canada which is too worried about taking care of scumbag criminals to protect its own responsible citizens. Vancouverites who actually get an education and work hard are thanked with a marginal income tax rate of 43.7% that kicks in absurdly early. So, Canadians have to earn money in a high tax jurisdiction. Meanwhile foreigners who earn money in low tax environments are able to come here and price locals out of their own market. Why does the government not tax these foreigners at substantially higher rates in an effort to protect its own? Foreign capital buying residential real estate should be subjected to a huge luxury tax.

Now the local scumbags. The exact scale of the drug industry in BC is unknown but in May 2009 The Economist estimated the annual activity to be $7 Billion; see this link: http://www.economist.com/node/13740305. With this being Canada, of course there is no political will to seriously fight the drug trade, and the industry is lucrative for all kinds of should-have-been-abortions. So the drug trade is one of the largest industries in the province, and guess what: the income earned is tax free. Yeah, one reason provincial income taxes are so high is because law abiding citizens have to subsidize services (health care, etc.) for the drug dealers who earn huge tax free incomes, draw on public services, and contribute nothing! Then when the dealers earn their money, they want to launder the money so they buy real estate, further escalating prices out of affordability for regular law abiding hard working Canadians.

Now, some suggest the reason residential real estate prices are sky high is because Vancouver is such a beautiful city that is supply constrained. These idiots believe that Vancouver is the only city in the world that people want to live in. Really? People all over the world are really tripping over themselves to live in the rain half the year in a centre referred to as No Fun City with citizens being amongst the most stuck up in the world? People don't want the rain over the sun. Criminals do however want a jurisdiction with the political will to tolerate dirty money. Let's be clear here: an expensive condo or home requires either A) A large amount of cash. Wages in Vancouver are unbelievably low before even discussing high income taxes and outrageously high commodities (gas, alcohol, etc.) that are the function of huge embedded taxes. The probability of actually saving any money is very low for the vast majority of Vancouverites. The other option is B) A huge mortgage. Well guess what? The mortgage has to be serviced? How can massive mortgage payments be made when gross incomes are so low?

The impact is that educated, law abiding Canadians are slowly starting to leave the province. That's okay though. The left wing nut jobs here blame us educated professionals for their problems. Well, as me and my educated peers are walking away from our six figure jobs and taking our intellectual capital outside of BC, they can rest assured knowing it won't take long to replace us with more foreigners having dirty money or drug dealers. This province is getting exactly what it wants. Vancouver is a perfect example of not to judge a book by its cover. Trudeau's dream, our nightmare.

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