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.”