Vancouver has held on to the notorious title of having the world’s second-least affordable housing for the second year in a row, according to a new survey released by a U.S. think-tank.
The 10th annual Demographia International Housing Affordability Survey declared the city’s real estate market the second-most expensive in the world, second only to Hong Kong, which retains the dubious distinction of world’s most unaffordable city.
The think-tank found in a survey of realtors that a single detached home in Vancouver costs about $800,000 on average.
The survey gave the city a median multiple of 10.3, meaning its median housing price is about 10.3 times more than its median household income – which is $65,000. Demographia considers any score above 5.1 a “severely unaffordable” market.
House prices in the West Coast “have been driven extraordinarily higher relative to incomes by urban containment regulations,” it said.
The next three most unaffordable markets in Canada were all in British Columbia, including Victoria, Kelowna and the Fraser Valley.
The three cheapest markets in the country were all in New Brunswick – Moncton was found to be the least expensive, followed by Saint John and Fredericton.
According to the survey, this is the sixth year in a row Vancouver ranked as one of the three least affordable major markets.
It looked at cities in Australia, Canada, China, the U.K., Japan, Singapore, the U.S. and New Zealand.
Meanwhile, the problem of housing affordability is not unique to Vancouver.
Canada’s major metropolitan markets all have a rating of “severely unaffordable,” and the report listed Canadian housing as the most overvalued among 20 OECD nations.
In addition to Vancouver, the three least affordable metropolitan markets in Canada were all in British Columbia: Victoria, Kelowna and the Fraser Valley.
The country’s most affordable markets were Moncton and Saint John in New Brunswick.
However, when major markets are excluded, Canada’s overall housing was rated only “moderately unaffordable,” outperforming Australia, New Zealand, Hong Kong and the U.K., where housing prices were all higher.
“Housing affordability is an important determinant of the standard of living, because higher-cost housing leaves less discretionary income,” says the report. “Severely unaffordable markets are also more attractive to buyers seeking extraordinary returns on investment.”
That pretty much sums it up!!!