Business

Vancouver Second Least Affordable Housing Market in the World

By Vancity Buzz Staff | 9:37 am PST, Tue January 21, 2014 | Speak Up

According to US think tank Demographia, Hong Kong and Vancouver, two cities that many think are similar, have been ranked the least affordable housing markets in the world.

The survey looked at cities in Australia, Canada, Ireland, Japan, New Zealand, Singapore, the US and the UK and Hong Kong.

See Also: Vancouver vs Hong Kong: How Similar Are They?

Unlilke most international housing affordability rankings and “city” rating sources that tend to focus on higher end housing that would be demanded by executives who might transfer from one nation to another. The Demographia International Housing Affordability Survey focuses on the middle of the market, the average household.

Hong Kong was the least affordable market with an affordability rating of 14.9. A housing affordability rating of 5.1 and over is classified as “severely unaffordable” and a reading of below 3 is considered “affordable.”

Vancouver ranked second least affordable market in the world with a rating of 10.3. This is the sixth consecutive year that Vancouver ranked as one of the two least affordable housing markings in the world.

Vancouver Least Affordable Chart

Housing Affordability Canada

Image by Clayton Perry Photoworks

Speak Up

  • http://tomaswilliams.com Tomas

    Tax foreign buyers; with the HOPE that it will decrease the inflation of property values.

  • iansyogablog

    The “1% cities”

  • Kyle Jones

    Exactly. Not necessarily ban it like Australia, but taxing it sounds like a great idea!

  • Lindsay

    Its hardly an international study if you don’t include Europe. The list would be very different if it did.

  • http://www.rew.ca/ REWca

    This is not a worldwide survey. It covers only Canada, US, Britain, Ireland, New Zealand, Australia and Hong Kong. No China, no Africa, no continental Europe. Not saying Vancouver is a model of affordability, but this survey, done by one man, cannot conclude that we’re 2nd least affordable in the world. For city-to-city cost-of living-comparisons, try Numbeo: http://www.numbeo.com/cost-of-living/comparison.jsp

  • NatalieLJohns

    Wonder where it all started from….from HK!..they ran out of room and came here…one way to changing it is changing the immigration law.Please come and buy property in Canada but live here for at least 6 months out of the year and contribute to our economy.

  • HelloCDN

    Has nothing to do with who started and who finished… People need to realize who they are voting for. I’ve moved to BC about 5 years ago and since then, each and every impression I have from not only Vancouver, but the whole province, is that it is the place to spend, not to earn. Even the hospitality industry, which is supposed to be the feature of BC, is so tremendously expensive that it will never generate enough volume for hotels which are not part of international networks e.g. Hilton, Sheraton and so on.
    And then you have Mayor Greg, who’s improving this city for “beauty consumption”, and doesn’t give 2 shits about people who actually have to live here.

  • Nick

    “Wonder where it all started from….from HK!..they ran out of room and came here..”

    [citation needed]

  • P

    Vancouver and Hong Kong have little in common other than expensive housing

  • TJ Grey

    If you do that, it falls into discrimination and racism territory. Canada should just grow its urban planning sector to make the market more developed and competitive like the foreign countries. With our dollar value and living standard being much higher than other countries, i don’t understand why we don’t just learn from how they operate their economies. Obviously someone is doing it very right to be able to afford foreign properties.

  • newtonbrotha

    HONG KONG IS MUCH MORE EXCITING BUT DIRTY

  • Jon Samuel

    Vancouver is an attractive place and attractive places are expensive, just face it. Name one place in the world that is world famous, attractive, has a high immigration rate and yet has the housing price of Manitoba. You get what you pay for.

    Why Vancouver real estate price is high? It’s the classic supply-demand model. Canada is one of the world’s top immigration destinations. Its beautiful, attractive, politically stable, and well balanced. Vancouver’s population is growing at 2% per year, a considerable amount of them are highly-educated or skilled worker immigrants with a sizable amount of income. That’s 50,000 people each year for the whole region. If each condo tower has 20 floors, 8 units on each floor and each units can live 2 people, then each tower can accommodate 320 people. You will need at least 150 such towers to be built EACH YEAR for the whole GVRD region to meet such demand. If you don’t meet this target, price increase will be above inflation – simple. Surprised by this number? Is Vancouver building enough?

    Thinking about single family houses? Do you know how much area each 5,000 houses take? Kerrisdale in Vancouver has about 15,000 residents and 5,500 households. It is about a quarter of Vancouver’s west side. So EACH YEAR, a whole Vancouver’s west side has to be built if we only rely on single family houses! Surprised again?

    Vancouver’s surrounded by mountains and water, so we cannot expand endlessly like Houston does, which has a higher population growth than Vancouver but still keeps housing affordable by expanding extremely rapidly into the suburbs. So the only solution here is to build more towers. Like it or not, that’s the only way out. Broadway WILL be filled with mid-rises, DTES WILL be gentrified, a considerable amount of the West Side WILL be densified. Also, rapid population growth and a desirable downtown core also means the near-downtown low density areas will experience rapid price increases, because those houses are the first to be demolished and densified through this process. Do you still want to afford a house in a rapidly growing city? The only option is to move to the suburbs or get considerably richer. This is true for every normal, health, big city that has a lively and attractive centre in this world. Vancouver’s prices are still relatively low on a global scale.

    I’m having a free informational and educational home buying seminar for first time home buyers in Vancouver on the 26th of Jan. Attendees can win up one of 3 prizes of $2500, $1500 or $1000 that they can use towards their downpayment…. They will NOT be asked to buy or sign up for anything! It is strictly educational. Details here: http://www.Facebook.com/VancouverRealEstateDeals – You can find out how to buy with as little as $15,000 down and $1500 a month. That’s not that unaffordable.

  • Vancityyy

    It doesn’t help that Vancouver’s job market is absolute crap for new grads… Kids living at home with their parents well into their late 20s, early 30s is now the norm in Vancouver. Quite a sad reality what Vancouver has become…

  • Guest

    Don’t see why continental Europe wasn’t included since cities like Oslo and Geneva would blow these cities out of the water.

  • vancityyy

    Taxing foreign investors/buyers isn’t going to solve anything. Money is not an issue for these investors. What needs to happen is the following: Vancouverites need to get off their high horses when it comes to urban planning. They bitch about large towers such as the trump popping up in downtown vancouver but at the same time, they bitch about the cost of houses/condos. You can’t have the best of both worlds. City planners need to lax their construction regulations and allow larger towers to be built. This starts with vancouverites wanting and embracing change. Look at any other major city in the world… They all have major 50+ floor towers up in the downtown core. We have to build both up and out.

  • jwolu

    Agreed. At the very least we can at least get some social services out of them treating property like a stock in the market!

  • jwolu

    We already have a system in place to collect this extra money. We have different levels when paying property tax. It’s not considered discrimination or racism at the moment. And it won’t be discriminating or racist if investment property tax is raised. Just simply if you live in the residence or not. You get a discount if you live in a property or are a senor living in the property as it is now. They just have to raise the tax on non residents and raise the discount for those that reside or are retired as long as they are residents for half a year plus a day. The countries around the world are trying to curb property investments that are driving residents out of being able to afford to buy in their own cities . Making properties unaffordable to people that have to live there is wrong and should be stopped world wide and I’m not discriminating or being racist investors around the world need to be curbed.

  • Think

    Some of the economies you wish to learn from benefit by looking the other way on human rights violations.

  • seanmartin

    Actually, it wasnt so much HK as it was a bunch of rich refugees from Taiwan who bought their way into the country in the late 1980s when it was threatened that China was going to declare it Chinese territory — overnight, apartments became condos and what rental property there was skyrocketed. My one bedroom in the West End, which I rented for 640, is now a million-dollar condo… with no discernible improvements.

  • jwo lu

    Not true with more money collected from property investors comes more money for government spending. More money for government spending equals more jobs for people to earn better money. Yes money is not an issue of these investors so we should at least benefit from them buying all these towers they have no intention to live in. With more government income we can repair our roads, parks, community centers, hospitals, provide appropriate social housing, lower ferry fees and many many more government run jobs and facilities. Making them invest not only in our property but the things that make this city run. With more government jobs comes more residents with more income to spend in turn making the restaurants, bars and other hospitality and tourism industries earn more money, It amazing how it. all filters down to improving the life style of all the residents in each city in the end. That in turn also makes it so that housing becomes more affordable again for at least a few more people. The great thing is that you don’t have to go through all the hardship of changing any laws which always takes a long time. The city just has to do a simple raise to property tax on investment properties of 5%-10% over 5 years. It won’t hurt investors but will improve our city. The Vancouver Airport’s airport improvement tax is a prime example of how taking a little bit of money from each foreign person can earn huge improvement
    for the airport and brings in foreign money for our economy. It can start slowly so that investors don’t feel a huge impact right away and get scared off. Start at 1%-2% per year. Making more empty towers is not working to lower the housing so it’s affordable cause we are not generating incomes to buy. This would create jobs and good jobs too.

  • Gail Miller

    The last say… 5 or 6 cities on the list NO ONE in their right mind would want to live in.. I mean wow.. If that’s the case I will take the more restrictive ones!!

  • jwo lu

    Also lax on construction regulations has already been done in Vancouver after Expo 86. It created building with building envelope issues. They won’t make that mistake again.

  • mike

    Why not charge (all)investors at the business tax rate of 18%, restrict ownership in the long run to people who already possess PR(after living here for 3 year, and require them to live here 9 months a year), restricting PR buyers to one house, track citizenship of buyers, and overhaul rules so we dont have 5 people living in 2 person apartments downtown(when there are empty apartments). Oh, and link any violations of the rules to the revoking of one’s PR.

  • mike

    And the seizure of their property for sale(even applying this to Canadian investors).

  • Vancityyy

    How’d you get all that from my response?

    Point 1: Increasing taxes is not going to stop foreign investors from buying condos (hence the money is not an issue comment; don’t look too deep into my reponse. Your point is already implied…. obviously increasing taxes will eventually lead to a trickle down to Vancouverites.

    Point 2: The city should look into approving taller residential towers downtown (like in other major cities) and this starts with vancouverites being open to 50+ story condos in the downtown core obviously. I didn’t say anything about repeating a leaky condo 2.0.

  • Jwo lu

    “Taxing foreign investors/buyers isn’t going to solve anything.” was what my first response was for. Maybe you need to figure out what you really want to post before hitting send. My first post only explains how taxing property will help everyone that resides in this city, and solving many issues Vancouver is facing. There was no need to read deeply into this comment it’s pretty black and white and simply thought out. Which I still reply taxing property investments higher then resident dwellings will solve a lot of problems by providing government income and since your above statement couldn’t see it I explained it in long form. But since ‘Money is not an issue for these investors” then we should just triple the taxes on investment properties and reap the benefit of them not having issues with money

    My second response was for your quote “City planners need to lax their construction regulations.” I did not need to read in between the lines there either. Which I still reply there are good reasons for us not to relax on our construction regulation. Regulations are there for good reason. Vancouver has experience too many problems in the past from shady investment companies and shady building companies trying to build to quick for too cheap. If you meant to say City planners need to open up property development applications so that the city could have 50 story buildings in it’s downtown core I would not have responded with my second comment on construction regulations.

  • Kurt

    As a Winnipeger let me say there is a reason Vancouver costs double the rest of Canada. The rest of this country is horrible to live in for half the year!

  • Rostak

    A vancouver friend directed me to this article. Just want to gloat and say that I love Pittsburgh and living here! I live in a big cozy house in the middle of the city with three other people for $240 per month. *gloat gloat gloat*

  • MrPC

    awww that was not that politically correct enough for you?

  • Born&RaisedButPeacingOut

    Im so excited to be moving out to Vancouver again in a year. I lived in a major US city for a while and let me tell you, the dollar goes WAY further and the quality of life is pretty comparable in some of those cities (not all). Its not all freeways and guns ;) . In fact, when you compare what you can actually buy i would say the quality is better personally. There are plenty of locations with mountains, lakes etc where $500,000 can get you a house comparable to a $2,000,000 house here. Plus my job that pays $110,000 pays $250-300k down south…. so ya there will be one less person to compete with for space

    Good luck to the 20 and 30 somethings here, you are in for a treat

  • orly

    “lets move to pittsburgh!!” – said no one ever

  • owner

    key word “rent” buy something, and then make a comment.

  • chan

    I’d take more expensive Hong Kong any day. It also takes a similar title to New York as the city that never sleeps. Vancouver is just a gloom ghost town – why pay the premium when you can’t enjoy exciting city life?

  • Alexander van Houten

    Label your axis

  • http://marwickmarketing.com/ Christian Thomson

    Well put – interesting stats

  • Kevin

    who the hell researched this? The research is so lacking that it cannot be trusted and with no clear rules to how the cities are measured (ie. the city as a whole or just downtown). And if you look at all other sources Vancouver does not even come close to this rank. It doesn’t even rank in the top 10. Seriously bad article. Whoever wrote this garbage should reconsider their career

  • KD

    I grew up in Vancouver all my life. I’ve always believed it was the best city in the world (It didn’t help that my belief was reinforced by the hundreds of articles coming out rating Vancouver as the top 3 most liveable or best city in the world). This all changed when I actually moved out and lived in other Canadian cities. I lived in Montreal for 8 months to do a co-op and immediately after that I lived for 4 months in TO. You know what I realized? There’s no heart, no culture, no excitement in Vancouver. The night life is a joke.

    Vancouver is a culture of “foodies”. There are no doubt there are many great restaurants and cuisine to try in Vancouver… but there is not much outside of the food culture in Vancouver. The landscape itself provides a TON for people to do outdoors. But in terms of what people provide to the city? ABSOLUTELY NOTHING. Vancouverites in general are closed off people who stick with their close nit friends and aren’t particularly open to meeting new people (unless it’s a friend of a friend).

    In my time out east, I met and made more friends than I did during my entire 4 years undergrad at UBC. My co-worker from Toronto has had a VERY hard time meeting new people… she said Vancouverites are very polite and friendly on the surface but are very guarded.