The Vancouver housing market is now officially insane. We all know the stats and the stories. Tear-down beater houses for $1.2 million. Pre-sale condo towers selling out in record time to offshore and insider speculators. Bidding wars, and house prices 12 times higher than the stagnant incomes.
Government attempts to cool the market have failed. A crackdown on assignment sales came in a year ago. The 15 per cent foreign-buyer tax followed in August. Mortgage restrictions were brought in, forcing buyers to qualify at higher rates. There are now tough new rules for short-term rentals and very high fines for vacant homes in Vancouver.
But the average house price is still increasing by $45,000 a month, the vacancy rate remains near zero, rents are soaring and housing sales are roaring back to record levels.
Skyrocketing land prices will make the fewer new homes even more expensive, which in turn makes it ever harder to recruit and retain employees.
We must reluctantly surrender Vancouver to the speculators, the elites, and the city’s entrenched and indulged underclass.
It is time to create another Vancouver, somewhere that middle-class families, millennials and the growing legion of seniors can find a comfortable lifestyle and a home they can afford.
If Metro Vancouver is knocked out of the equation, the average home price in British Columbia now is around $400,000. Even on the coast, the average is not much more than $500,000 and many condos are half that price.
These prices easily qualify for the B.C. government’s first-time buyer incentive that matches a buyer’s down payment with a no-interest, no-payment loan for five years. They are also within reach of average wage earners and most retirees. Plus there is land, and local governments that are eager to attract business and families.
Victoria homes are already ascending to unaffordable levels, so we must look at smaller centres to turn into the next Vancouver.
Possible options include Kamloops - about four hours from Vancouver with excellent infrastructure, a large land inventory and an average house price of $360,000; the land-rich Sunshine Coast – 35 minutes by ferry from the Lower Mainland but a fixed link is being studied – where the typical house price is $538,000; and Nanaimo and District, a potential Silicon Valley north with a nascent high-tech industry, oceanfront, a land mass of 2,034 square kilometres, – nearly equal to Metro Vancouver – and detached houses for less than $500,000.
Such a move would demand rare political vision and leadership, but it should be started now because so many people will inevitably be forced out of Vancouver.
With the right incentives and planning, the exodus could be directed to a single centre with employment, opportunity and affordable housing for middle-class refugees.