British Columbians flee rising housing costs
More Canadians are leaving than arriving, with 2,234 residents having left the province in the last three months of 2012 alone
Another year older and deeper in debt. The saying has special relevance in Vancouver, where so many are financially squeezed. study by TransUnion, an Ontariobased risk- management company, reported recently that British Columbians are the most heavily indebted Canadians.
The company measured non- mortgage debt — lines of credit, credit card balances, as well as bank and auto loans.
Turns out, on average, each of us has nearly $ 40,000 in non- mortgage liabilities, an amount that grew in the past year by 3.2 per cent.
But imagine how much worse we would look had TransUnion factored in the scary mortgages many Vancouver residents are carrying.
Large mortgages are a scourge, seriously limiting what folks can do on other fronts to enhance their lives.
Indeed, onerous mortgages probably are the reason British Columbians have so much non- mortgage debt.
It now takes 82.3 per cent of typical household income to purchase a detached bungalow in Vancouver, according to Royal Bank figures released last week.
So, the average Joe can buy himself a cosy fixer- upper in Vancouver and have a little left over for taxes. But he would have to forget about ever eating another meal.
My colleague Tracy Sherlock has reported that calls to the local offices of the Credit Counselling Society increased 23 per cent in the first five months of 2013, compared to 2012.
Politicians are not taking account of the affordability challenge in their policy making, continuing whenever the mood strikes to raise government fees and taxes.
Yet, the situation is dire, according to the Demographia International Housing Affordability Survey.
It annually calculates a “median multiple” for 337 markets, measuring house prices in relation to local incomes.
Anything with a score of 3.0 is considered unaffordable, over 5.1, severely unaffordable.
Vancouver, with a median house price of $ 621,300 and household incomes of $ 65,200, has a score of 9.5.
The global financial capital of London — boasting endless cultural and consumer offerings — is at 7.8.
Demand, of course, is what drives pricing. And it is no secret that Vancouver is a relatively prosperous, future- oriented city in a stable democracy. It is endowed with natural beauty and located in the only corner of Canada with a moderate climate.
By contrast, Americans seeking reasonable temperatures can choose from an array of urban options.
Additionally, Vancouver — bounded by water and mountains — has limited land on offer.
Foreigners have discovered our city and its real estate, and the result is an unaffordable city.
When I recently scrutinized options on the city’s west side, it became clear that a small, seedy bungalow would set me back $ 1.4 million, soaring upward from there.
Two house- hunting lawyer friends, a husband and wife, told me the other week they had bought two homes in Kitimat as an investment, but will keep renting in Vancouver.
No one will weep for them, of course, or me.
Those in the know say the market lately is moderating, with slower sales, but prices are barely budging.
The cost of housing could be one reason why many are leaving — more Canadians have been leaving than moving to B. C. since 2011.
On a net basis, reports BC Stats, the province lost 2,234 residents in the last three months of 2012 alone.
Still, politicians are looking the other way, focusing interest and efforts on the desperately needy and homeless.
The province so far has refused to reduce the Property Transfer Tax, or forgive PST on realty fees.
That Conservative MPs and Liberal MLAs in B. C. failed utterly to foresee taxpayer ire over the imposition of a costlier HST speaks to their lack of attention to the affordability crisis.