Steve Gosling and his family are moving into a brand-new townhome this fall. It’s in Maple Ridge, and construction is ongoing.
“We actually skipped looking at Vancouver itself,” Gosling said in a phone interview with the Georgia Straight. “There was no way we’re going to find anything in Vancouver. It was just way over our price range.”
There are three of them in the family. Gosling and his wife are both 31. His stepchild is entering Grade 7 this September.
They’re renting a 700-square-foot ground-level suite in a detached house in Burnaby, near the tech company where Gosling works. They wanted a place big enough for them to grow into, and stay for a long time.
“We did wind up getting a larger property, and the only way to get that was to go far away from Vancouver proper. That was part of what drove us,” Gosling said. “There was a lot of places that we found that we like, but were just not that big.”
Their new 1,700-square-foot-plus townhome has four bedrooms and three bathrooms, and cost nearly $500,000.
“My wife and I regularly look at each other and giggle excitedly before exclaiming ‘We’re going to have a pantry!’ ” Gosling said.
He added that he’s no longer worried about getting priced out of the market. But he’s kicking himself for not making the jump earlier.
“I’ve had a proper tech job for about six years now,” Gosling said. “And so for a lot of that was while I was a bachelor, and I could have bought a place all my own and…probably had it all paid off by now. When I remember first looking at condos, buying a condo outright was about as much as we’re doing for a down payment on our townhouse. And so, if we had done that before, [and] property values went up, we would be getting a place a lot closer, that’s for sure.”
Before, Gosling thought that if he rented, saved, and invested his money, he would build wealth comparable to the returns of owning a home.
Looking back, Gosling said, “I just don’t think that that was true. I think there was a lot of rationalization, and me trying to be smarter than I was. And what I really needed to do was sit down, get a down payment together, and then just get it done.”
More than 10 years ago, the UBC Centre for Urban Economics and Real Estate released a paper titled “Are Renters Being Left Behind? Homeownership and Wealth Accumulation in Canadian Cities”.
“It is not that renters cannot in many areas build wealth similar to that of owners, but that to do so demands a level of discipline that most North American households have shown themselves unable to achieve,” the paper noted. “As well, they must follow investment patterns that are not the norm for small investors. This suggests that a tremendously significant benefit of homeownership for individuals is that the constraint of mortgage payments effectively forces home buyers to save by building equity through the repayment.”
As first-time homebuyers, Gosling said he and his wife found that working with a realtor gave them the confidence that they’re “not making a mistake” along the way.
“Our realtor Darin Germyn helped us to make sure it was a reputable seller and a reasonable valuation, and we decided to go in on it,” he said about the vice president of the Fraser Valley Real Estate Board. “Darin helped us a lot with the mechanics of the process: how to make an offer, how to put clauses on there, suggestions for which clauses to put on, closing the deal, et cetera. The works.”
Gosling is astounded by how home prices just keep going up.
Over the last 10 years, the price of a typical home in Metro Vancouver has risen by almost 91 percent.
“I don’t know how that could be sustainable without wages following suit,” Gosling said.
Two years ago, the Vancity credit union noted in the paper “Downsizing the Canadian Dream: Homeownership Realities for Millennials and Beyond” that if trends continue, an average home in Vancouver will cost more than $2.1 million by 2030.
This means that monthly mortgage payments will exceed household income by eight percent in Vancouver.
Moving to the suburbs may no longer be an option in the future. What the Vancity paper found “most concerning is the reality that even the currently affordable communities of Maple Ridge, New Westminster, Pitt Meadows and Port Coquitlam will become unaffordable to the average household within 15 years”.More