Exorbitant real estate prices are an accepted downside in Vancouver. When I go to a Kits apartment party with 30-something peers, there’s no shortage of complaints. We stand crammed like sardines in a tiny “den” bemoaning the fact that starter homes are well out of reach. Despite saving for a down payment and making offers, many are still on the hunt and losing hope.
As more media outlets focus on the middle class housing shortage in Vancouver, the big question is: How far does the average family have to move to buy a bigger home?
On housing prices
According to CBC, the average price for a resale home in Canada was $360,000 in November 2011. But $360,000 goes farther outside of Vancouver.
In Vancouver, $360,000 will only get you something like a one bedroom/one bathroom condo with 653 sq. ft. In Toronto, you can get a 765 sq. ft., one bedroom for the same price. In spots like Fredericton and Charlottetown, you can get a 3-4 bedroom, single family home for slightly less ($358,000-$359,000). (Source: CBC’s random real estate search using MLS listings.)
Middle class flight
Vancouver Magazine’s recent article “Going going gone” details the urban flight of Vancouver’s ambitious middle class (median family income $68,000) to areas with lower housing prices.
According to the article, in January 2002 the average price of a detached house in Metro Vancouver was $390,000. It nearly tripled to $1.1 million in 2012. If you didn’t buy early, you’re out of luck and nicknamed “Generation F*cked” in the piece.
“Unless the members of Gen F want to raise their children in a one-bedroom condo, their salaries will qualify them to be no more than permanent renters in Vancouver. This is a well-known phenomenon in cities like Paris and New York, but it’s a recent development here, one taking an entire cohort in their 20s, 30s, and 40s by surprise,” says author Tyee Bridge.
You can read the rest of the author’s interviews with Vancouver’s Gen F renters here.
As I mentioned from the beginning, we know that real estate prices in Vancouver are extremely high. The asking price on this two-storey, 1,600-square-foot home in Kitsilano is $1,498,000 , much higher than the national resale average.
So what’s new? Middle class renters now believe two key things:
1) The market is not going to crash.
2) They can leave and get a better deal.
One of my colleagues recently picked up and headed to Victoria for the lower costs and thriving urban culture. But for most of us, jobs and personal connections are strong motivators for staying put…at least until we’ve got three young children splitting a cramped condo bedroom.
Have you been bidding on starter homes in Kitsilano? Tell us about your frustrations, successes and worries. Would you leave Vancouver in order to “put down roots”? If so, where would you go?
Last modified: January 27, 2012
Hello,
My husband and I moved here from Toronto in April of last year. I am from Victoria and was living in Toronto for work opportunities.
We had been remotely searching for a potential home in Kitsilano for the previous six months and bid on perhaps five or six homes. We were outbid by thousands…or hundreds of thousands of dollars every time.
We understood the houses were expensive were looking for a family home with some kind of minimal character or ‘ocean glimpse’ on a standard 33 x 122ft lot that we could enjoy raising our child in…and we could fix up and make a profit on after 5-10 years. After another two months of searching while living in a temporary furnished apartment in Kits Point, we saw the writing on the wall and realized we couldn’t afford anything we could enjoy and be confident about as an investment, so we quit looking and rented a home instead (the home itself was quite convincing as well….we loved the location and view). Now, we;re planning on moving back to Toronto in order to be able to afford to buy in a neighbourhood we want to live in.
This article was excellent. I am Gen F and feel like my time in Kits is limited…living here is a fantasy land and comes at a cost that is unsustainable. We’ll eventually have to go back to Toronto – and reality.
Thanks for sharing your experience Monica. At least you know you’re not alone. Here’s more coverage of the challenges home/condo buying that includes East Van too: http://www.bcliving.ca/home/tiny-boxes-vancouver-condominiums-continue-to-get-smaller-in-size-while-prices-rise
The market’s not going to crash? The only people who have “realized” this are deluded. We’re in a bubble.
How is it that “middle class renters” have come to the conclusion that “the market isn’t going to crash?” Based on what kind of assessment? Gut feeling? Rearview mirror gazing (i.e. it’s been going, so that means it will keep going up)? Please illuminate readers.
From where I’m looking, and from what I’m reading, it doesn’t look so great for continued price appreciation, all that “asian investors” stuff aside. I mean, really, if you’re an outside investor, and you could plunk your cash anywhere, why oh why would you decide that it’s gotta be Vancouver, when by almost every metric, it’s clearly overvalued.
Remember, when there’s a bubble, few people in the market realise it’s a bubble. That’s what helps to make it a bubble.
@Sidelines: Opinion culled from the article referenced in the blog post: http://www.vanmag.com/News_and_Features/Gone?page=0%2C0
You can read all 12 pages and evaluate the claim by following the link to Van Mag and the “Going going gone” piece by Tyee Bridge.
Taraneh, I think it’s fair to say that your original post supports the point of view espoused by so-called “middle class renters” that there will be no crash. That is what I was responding to and evaluating.
While it may not be worthwhile to dig deeper on the point made that housing prices are very high, since that’s easily proven/measurable, that’s quite distinct from the claim that the market’s going nowhere but up. That, of course, is a prediction and difficult to confirm, in my view. I suggest that readers would have benefited from an attempt to evaluate that claim rather than simply taking it as truth. In other words, is it possible that “middle-class renters” might have it wrong on housing price appreciation going forward? Are better times ahead for those wanting to get into the market?
Finally, to your suggestion that I could read the Van Mag article, I’d say well and good. I could, and may very well read it, thank you. Putting that aside, though, if your whole piece is relying primarily on another article for validation, would it not be helpful to let readers to know that from the outset?
Kitsilano.ca regularly rounds up news from other sources which are cited.
The blog post is prefaced by personal anecdotal evidence like “When I go to a Kits party.” It ends with anecdotal evidence like “One of my colleagues.”
The stats on prices and the middle-class flight topic are transparently taken from other sources which are listed and linked. Example 1: (Source: CBC’s random real estate search using MLS listings.) Example 2: “According to the article.” Example 3: “You can read the rest of the author’s interviews with Vancouver’s Gen F renters here.”
Feel free to continue to comment with your opinion on the crash. It’s a hot topic. It will be interesting to see how it plays out.
Me: “hey, how about trying to back up your ‘no crash’ claim?”
You: “read this other article, it’s all there.”
Me: “might’ve been more interesting, and notable, if you’d dug into the story a bit. you’re not saying much otherwise.”
You: “I got info for stuff you’re not arguing here and there. The other stuff you’re taking about, people I’m acquainted with said. Come back and visit anytime.”
Me: “Oh, I see. And, thanks, I will.”
It’s a news round up, not an argument. But we like inflammatory opinions and heated discussion! If you have blog topics you’d like to write about, please submit to Taraneh@Kitsilano.ca. All bloggers are unpaid. Cheers!
Wow, Taraneh… so you delete me referencing the fact that you made an edit to your piece (after my 1:31 pm post), which changes its tone from opinion to, as you put it, “news round up.” It’s not really an honest discussion anymore, is it? Notwithstanding that you ostensibly like “heated discussion.” What do you think such a move says about you? Why don’t you just delete it all? I’m laughing and shaking my head at the same time.