There is a lot of angst in Metro Vancouver surrounding the challenge of buying a house with an average value of well over $1 million while the median income in the region is in the range of $70,000.
Recently we talked to a Burnaby homeowner who said his family was struggling to cover the $1.5 million price of a “regular family house in Burnaby, nothing spectacular” – and this was after he had won a $2 million tax-free lottery prize. “By the time we put down a down payment and cover the cost of our two girls in university, we are just making it,” he said, “We are both still working.”
A recent study by University of British Columbia associate professor Paul Kershaw estimated that a young house buyer would need to work for 23 years to save up the 20 per down payment required to buy an average house in Vancouver.
But it apparently it can be done a heck of a lot quicker. In fact, we are in awe of how three First Nations bands, one of which has only 1,400 members, have amassed a fortune in real estate in just two years.
The trio of First Nations in Metro Vancouver, whose members together have a medium income of less than $31,000, according to the most recent Canadian census, have managed to purchase almost $1 billion worth of real estate, including 90 acres of oceanview development property in Vancouver’s exclusive West Point Grey, all since 2014.
This March, the Musqueam, Squamish and Tsleil-Waututh bought 38.8 acres in Point Grey for $480 million. Two years ago, with Canada Land as a partner, the same bands bought another 52 acres in Point Grey, for $237 million. And they didn’t get much a sweetheart deal on the most recent Point Grey purchase: the price was based on two current market appraisals, though the province did give the bands a $96 million discount on the final price to extinguish any future land claims. This was apparently applied as a downpayment,
With the average house building lot in Point Grey now priced at $3.28 million, the First Nations could potentially reap a windfall profit after redevelopment. A spokesman for the bands has already dismissed silly talk of any affordable housing being built on the prime lands.
Also, in the spring of 2014, the three bands bought a 39-acre site from the provincial government for $57.9 million, and then immediately purchased the provincial liquor distribution warehouse on East Broadway in Vancouver for $36.9 million. The savvy buyers then rented the liquor warehouse back to the province for more than $1.4 million a year.
So, young homebuyers in Vancouver, take heart. It is somehow possible for some to secure real estate in the city, regardless of income level.