23 years to save a down payment in Metro Vancouver’s hot real estate market: report

Findings by Generation Squeeze underscore dire home affordability challenge for young in Lower Mainland

A new report on housing affordability in Metro Vancouver compares what a buyer could get in 1976 to today for an equivalent price.



A new report paints a stark picture of how unaffordable housing has become for young people in B.C.’s Lower Mainland in an era of rapidly escalating real estate prices.

The UBC-led Generation Squeeze project found just 15 per cent of Metro Vancouver homes cost less than $500,000 and have at least three bedrooms as of 2014.

Average prices in the region are much higher, but the researchers picked the $500,000 threshold because it’s twice the cost of an average home in the region in the late 1970s, after adjusting for inflation.

“This means what used to buy two entire homes when today’s aging population started out as young adults now only buys two bedrooms,” said Anita Minh, co-author of the report Code Red: Rethinking Canadian Housing Policy. “Often, that’s not enough for a family with two children.”

The report found that while it once took a typical young Canadian five years to save a 20 per cent down payment on an average home, it’s much worse now.

Now it typically takes 12 years across the country to save up that down payment, 16 years in B.C. and 23 years in Metro Vancouver, said UBC professor and co-author Paul Kershaw.

Despite historically low interest rates, the average monthly mortgage payment required from a young adult starting out in Metro Vancouver reached $3,555 in 2014, compared to $1,991 in 1976-80.

That means it takes the typical young Metro Vancouverite an extra 2.5 months of work per year to pay the mortgage, Kershaw said.

The report found only seven cities in Metro Vancouver have at least 25 per cent of their homes priced under $500,000 (in 2014) with three or more bedrooms – Port Coquitlam, Pitt Meadows, Maple Ridge, Surrey, Langley City, Langley Township and Delta. (Maple Ridge is the only one with more than half the homes falling into that category.)

Create bar charts

The trade-off for a larger home with a yard in one of those cities is generally longer, more costly commutes, the report said, estimating the extra direct transportation costs of living there adds $120,000 to $180,000 over 25 years.

The Generation Squeeze report was released Wednesday, on the one-year anniversary of the #donthave1million rally on housing affordability in Vancouver.

The report recommends a speculation tax that taxes capital gains on homes flipped in less than two years and a surtax on home values to dampen speculation, especially at the top end of the market.

It also urges more tax incentives for purpose-built rental housing and use of new tax revenue to provide other assistance for housing affordability.

Code Red:Rethinking Canadian Housing Policy

Just Posted

Opioid overdoses killing three people a month in Chilliwack

35 deaths in 2018 locally compare to 23 in 2017, 13 in 2016 up from about five per year before that

Outdoor rink, lagoon improvements on the agenda for Harrison

The projects are intended to increase tourism numbers and infrastructure in the resort village

Chilliwack parent urges fellow dog owners to keep Fido off school grounds

Risks of harmful encounters between kids on and dogs are too high, says Chilliwack mom

Coquihalla closed southbound near Hope

DriveBC suggests detouring via Highway 1

It’s a snow day for the Fraser Cascade school district

School District 78 has closed all schools and stopped all bus routes for the day

VIDEO: Wheelchairs teach Agassiz students acceptance through sport

Teacher Donna Gallamore brought wheelchairs to the Kent Elementary for learning and fun

Snow turns to slush, rain as it warms up across B.C.’s south coast

Some areas are already covered by more than half a metre of snow following three separate storms

Father to be charged with first-degree murder in Amber Alert case

11-year-old Riya Rajkumar was found dead in her father’s home in Brampton, Ontario

Police track armed kidnapping across Thompson-Okanagan

RCMP allege it was a targeted crime believed to be linked to the drug trade

St. Paul’s Hospital replacement slated to open in Vancouver in 2026

Announced many times, but this time there’s money, Adrian Dix says

Fourteen ‘dream’ homes ordered evacuated as sinkholes open in Sechelt

Sinkholes throughout the subdivision have prompted the District of Sechelt to issue evacuation orders

Police investigating after 14-year-old boy pepper sprayed at Surrey mall

Surrey RCMP say two males fled the scene before officers arrived on scene at Guildford Town Centre

Third measles case in Vancouver prompts letter to parents

Measles is highly contagious and spreads easily through the air

Abbotsford’s Matsqui prison beefing up security against contraband

Correctional service says officials found a number of unauthorized items during ‘exceptional search’

Most Read