Business

Vancouver Second Costliest Housing Market in the World

By Vancity Buzz Staff | 3 years ago | Speak Up

It’s no secret to lower mainlander’s that housing prices are sky high. The recent Demographia survey indicates that Vancouver is now the 2nd costliest housing market in the world, just behind Hong Kong and ahead of Sydney.  The city has become so unaffordable for most that many are forced to the far flung suburbs to toil away in rush hour traffic day in and day out. The amount of million dollar detached homes is ridiculous, just check out this map of million dollar homes in Vancouver.

Here is a blurb from Bloomberg Businesweek:

Vancouver displaced Sydney as the least-affordable housing market after Hong Kong among large English-speaking cities, as home prices rose faster than incomes, a study of 325 metropolitan areas worldwide showed.

Vancouver’s median home price of C$678,000 ($686,400) in the third quarter was 10.6 times its median pretax household income of C$63,800, making the city “severely unaffordable,” Demographia said in a report today. A ratio of 3 or less is considered “affordable,” according to the public-policy firm’s survey of markets in Australia, New Zealand, Ireland, the U.K., the U.S., Canada and Hong Kong.

Sydney’s ratio of median home price to income was 9.2, while Hong Kong’s was 12.6, a record for the eight-year-old survey, surpassing the previous high of 11.5 for Los Angeles in 2007. Home prices in Hong Kong, Vancouver and Sydney haven’t plunged as they have elsewhere, such as in Ireland, now the second most-affordable country, after the U.S., the study said.

“Housing affordability generally improved in the surveyed nations, though the most unaffordable markets, Hong Kong and Vancouver, became even more unaffordable,” wrote Wendell Cox, principal of Belleville, Illinois-based Demographia, and Hugh Pavletich, managing director of Pavletich Properties Ltd., a commercial developer and investment company in Christchurch, New Zealand.

Policies limiting lots available for construction drove up land prices, putting homes out of reach for middle-class buyers and younger workers in cities such as Vancouver and Sydney, the researchers said. The median price of a detached house in metropolitan Vancouver reached a record C$900,000 in April 2011, according to the Real Estate Board of Greater Vancouver.

For those waiting for the bubble to burst, it looks like you’ll have to keep on waiting. I’m not saying prices will continue to go up forever, however, a bubble bursting scenario isn’t likely. Furthermore, if such a thing were to happen, there are so many buyers waiting to jump in that prices will just go up again. At this point I’m not even convinced that density is the answer. After all, Manhattan is the most dense part of North America, and housing is insanely expensive over there.

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Speak Up

  • Jooinzg

    West Vancouver ftw. Vancouver blows

  • http://twitter.com/CoastalSprite Jen

    Burnaby and Surrey aren’t too bad. Metrotown condos are as low as $250,000.

  • http://twitter.com/amarmirch Amar Mirchandani

    Moving to Sydney bye

  • Anonymous

    When you have had your mortgage for a long time, it is not a good idea to Refinance, let me stress again, DONOT refinance if you have your mortgage for long time, to avoid mistakes, use 123 Refinance articles.

  • Anonymous

    Foreign investors are driving up prices in Vancouver: “Cam Good, president of The Key, a Vancouver-based realestate marketing firm that caters to Asian buyers, said that about 60 per cent of the estimated 1,500 condos he sold this year, in Vancouver and Toronto, were to Chinese buyers.”

    Read more: http://www.theprovince.com/business/time+curb+foreign+real+estate+buying+Vancouver/5703433/story.html#ixzz1kJVJF000

  • ariane c

    It’s become a status symbol to live here. Not surprised by the figure, but still shocking to think how many beautiful cities in the world are less costly than ours to live in!

  • http://www.rentforthegames.com/ Martin

    Vancouver is a very stable market. The run up we saw in the last 10 years has leveled off and the demand has not dropped yet. Everyone I know would much rather live in Vancouver than anywhere else in Canada. Yes its a symbol of wealth and seemingly overpriced real-estate but I see a lot of people complaining and not too many moving out :)

    Some of the most amazing real estate can be found on this site http://www.vancouverhouserent.com
    those are rental properties but each is well north of the 1 million dollar mark currently assumed as average…

  • Bbehnia11

    So what? Stop being racist and jealous just because many Chinese people are willing to invest their money in Vancouver. I personally think it’s not even worth this people investing their money in a backwater place like Vancouver. They are being drawn here by policies set by conservative and BC liberals which creates an environment where Chinese buyers come and buy properties here, and keep spending their money, and it is partially a great thing, since this place would be an even bigger shithole like Kelowna and Prince Rupert if it wasn’t for the Chinese investing their hard-earned cash here. Stop blaming the people who work hard and make their money “outside” of Canada and then bring it here so you can have another nice coffeeshop down the street, a nice cozy park at this neighborhood etc. If it wasn’t for this money, a lot of other things would be missing here too. Now go and fight the right fight: ask for opportunities and better job security, so that you can actually climb the ladder and be happy here and one day buy your own property too! Want to blame someone? blame the Federal and Provincial governments that make sure companies ship their operations somewhere else and work and career opportunities become even more scarce…it’s the economy stupid!

  • Bbehnia11

    I don’t know what status symbol you are referring to…I actually have come to believe that this place is very much full of people who may have a lot of money but not much intellect or culture/class…something which was touched on through a previous article on dating in Vancouver. There are also many many beautiful cities around the world where home prices are affordable, and most importantly, people have class, heritage, history, culture, and are way more friendly and open to other citizens. I for one am moving to Australia to start my career because there are no opportunities for me at the moment, the climate sucks, and the people even more so! I need a warm place where people are warm and friendly too, and Vancouver is not it! I’m sure a lot of people out there agree with me too!

  • Aaron Bhawan

    moving to toronto bye! lol

  • Aiheityu

    ..He never said it was racist. It’s a fact. And the situation is a lot more complex than just Chinese people spending their money here and making it less of a “shithole like Kelowna and Prince Rupert.”

  • Bbehnia11

    Hey there is a market to buy condos and houses, and there are people overseas who are willing to spend their money and buy these properties, and you know what? Even if they rent these guys out, which they do, they don’t really make a big cash flow out of it, only containing the mortgage they are already paying off! Although there are some big-time developers out there who make tons of money renting and selling and buying and speculating and selling later for more cash, I don’t dispute that. I believe that you should look at the institutions that help foster this situation, where it’s not worth much building rental units that are high quality, but building the site up and then selling it for cash. Blame the existing City regulations and the NIMBY powerbrokers who make it less profitable to build rental units, to rebuild and update older buildings, who stand in the way of progress and meaningful change!

  • Adam Nowek

    “At this point I’m not even convinced that density is the answer. After all, Manhattan is the most dense part of North America, and housing is insanely expensive over there.”

    Fact: Vancouver is bigger (119 square km) than Manhattan (59 square km).
    Another fact: Manhattan has a significantly larger population (over 1,5 million) than Vancouver (around 600.000).

    Way more people competing for way less space. To say density won’t have a positive affect on those trying to live downtown is silly. Comparing a denser Vancouver to Manhattan is comparing apples to oranges.

  • Mjackson

    Hey buddy
    Kelowna is no shit hole.  It is the best place to live on earth.  Unless your rich, your living in a cubicle.  Way overpriced crap houses that are ready to fall down.  Half fun communting in that cess pool.  What kind of life is that?  Let that rats nest drive people insane.  People will eventually leave that shit hole of a town.

  • Jwo lu

    I’m Chinese and after reading bbheniall’s comment I did not take his comment as “Racist” But good on you for throwing out the racist card and taking the importance out of it. He said foreign investors then gave an actual example of a stat he was given. I have seen this situation take over Vancouver like a disease. It’s not Just Chinese, it’s not just the South Asians, it’s not just the Russians. It’s people and corporations with big money screwing up the economy world wide by treating real estate like some crazy stock that can bought and sold at whim. Though keep in mind the Chinese have an added incentive of wanting to move their money out of China and this is the most perfect laundry scheme you can get. Buy house with Yen sell house for Canadian dollars or euro or frank. Many countries have adopted a max for investment and minimum amount of time that you must keep a property for. Like One house is you living property and a 2nd property can be bought as investment. The investment property can not be sold for 2 years. Until our government actually steps in and implements this situation we may just end up with ghost towns that have popped up everywhere. Like in this video. http://www.youtube.com/watch?v=InqAzvX6UrI