Rachel Ralph and her husband, Steve, never imagined being able to buy in Vancouver. Much to their surprise, they even got into one of the most desirable neighbourhoods in the city.
What astonished them more was that the cost of owning their Kitsilano condo is less than what they used to pay in rent.
“We were really shocked,” Ralph told the Georgia Straight in a phone interview.
They’d been renting at UBC for a couple of years when they decided to move off campus.
“It’s a nice location, but it’s near all the fraternities,” Ralph related, “and so there was a lot of parties, and we wanted somewhere a bit quieter.”
She was completing her PhD at the time and teaching at the university as well, which she continues to do.
“I started looking at places to rent for about six months before our lease was up, and the more I started to look, the less I found, and there were certain restrictions,” Ralph recalled. “One is we have two dogs, and that was actually, I think, the biggest barrier.”
After months of searching, they began to ask themselves whether they should buy instead.
According to Ralph, they weren’t confident, because a lot of media reports seem to suggest that one has to be a millionaire to get a place in Vancouver.
They started playing with online mortgage calculators and learned that with her income as a university instructor and her husband’s pay as an auto technician, they could afford a home without a lawn.
“Steve has a different bank than I do, so we made appointments at both banks to see basically who would give us the most,” Ralph said, laughing. “And once we found out how much we could get, we realized that we could probably get a one-bedroom condo in Kits[ilano].”
They then asked friends about reputable realtors, and that’s how they got connected with Tanya Jakubec.
Being first-time homebuyers, Ralph said, they relied a lot on Jakubec, from understanding how the market works to dealing with specific tasks such as analyzing depreciation reports.
They visited 40 open houses and discovered that listings go fast and usually over the original selling price.
Before closing the deal on their Kitsilano condo in May last year, for more than the asking price, they placed bids on three other properties and lost.
According to Ralph, their monthly mortgage and strata fees are a few hundred dollars less than the $2,400 they used to pay in rent at UBC.
Although they were able to get into the market, Ralph said that surging prices may impact their plans to upgrade to a bigger home.
“The market has increased, which is great, and we’ve increased value in this current property, but that also means that everywhere it has increased,” she said. “So it’s kind of we feel like we’re still going to be shut out again.”
Ralph noted that a unit in the building where they live, which is quite comparable to the apartment they got a year ago for more than $400,000, recently sold for $540,000.
A B.C. economic briefing paper released on June 23 by Central 1 Credit Union stated that “tight market conditions are generating significant price pressures in most markets.”
The trade association of credit unions also noted that “efforts to curb activity, including the foreign buyer tax in Metro Vancouver, which had some ripple effects to other markets, have run their course, and tighter federal mortgage insurance policies have seemingly had a mild impact.”
The Real Estate Board of Greater Vancouver has reported that sales in May this year rose 22.8 percent compared to April, and were 23.7 percent above the 10-year May sales average.
The benchmark price for all residential properties in the areas covered by the board increased to $967,500, or 8.8 percent higher than in May last year and 2.8 percent over that in April 2017.
Ralph and her husband are in their early 30s. With the PhD she completed in March this year, Ralph hopes to get a better-paying job. With that, she said, they may have a shot at another bidding war in the future.