Vancouver housing affordability suffers steep fall

Vancouver’s housing affordability has deteriorated more than any other major city found on Demographia’s latest list of severely unaffordable cities around the world, released Sunday.

That the 14th annual survey put Vancouver third on its severely unaffordable list, just behind Hong Kong in the no. 1 spot and Sydney at No. 2, may seem unremarkable after years of escalating housing prices. But the speed at which Vancouver turned so unaffordable is unparalleled, according to the survey, produced by U.S.-based Demographia and Performance Urban Planning from New Zealand.

The survey rated middleincome housing affordability using a measure called the median multiple. It captures the median house price divided by the median household income in a given market. A median multiple of 5.1, which means a home costs more than five times the average annual household income, is considered “severely unaffordable.”

Vancouver’s median multiple of 12.6 is third worst among the 92 major metropolitan markets included in the survey, and incidentally, third worst in the history of the survey.

But as recently as 2004 its median multiple was just 5.3 — still severely unaffordable, but nowhere close to its 2017 figure.

Looking a little deeper, the amount that Vancouver deteriorated in those 13 years was more than five times the amount it had deteriorated in the 30 years preceding 2004.

The survey, released by the Frontier Centre for Public Policy, noted that B.C.’s foreign buyers’ tax appeared to have “cooled the hyper-inflation at least temporarily,” but it noted that housing prices were again on the rise — up 11 per cent over the past year. That is approximately four times the increase in average earnings, according to the survey.

Several cities near Vancouver were also ranked by the survey and found to be severely unaffordable, including Victoria (8.1), Nanaimo (7,2), Chilliwack (6.8) and Kelowna (6.6).

Toronto’s median multiple stood at 7.9 in the latest survey, up from 3.9 in 2004, while Montreal was listed at 4.5 — up from 3.1 in 2004. They are followed by Calgary (4.1), Ottawa- Gatineau (3.9) and Edmonton (3.7).

The most affordable Canadian market among those surveyed was Moncton, with a median multiple of 2.1.