Vancity Credit Union

Vancity Credit Union

March 25, 2015 08:00 ET

Report: Metro Vancouverites Priced Out of Their Own Back Yard by 2030

Most families will only be able to afford condos unless changes are made

VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 25, 2015) - Millennials dreaming of homeownership in Metro Vancouver are going to have to downsize their expectations, according to a new report by Vancity credit union.

The report, Downsizing the Canadian Dream: Homeownership for Realities for Millennials and Beyond, shows that if current affordability trends continue, average property in Vancouver will require more than 100 per cent of household income by 2030. Moreover, average property in the Metro Vancouver region will be unaffordable, requiring unsustainable debt-loads to maintain.

By that time, average per cent of income required to maintain a mortgage in various communities will become unsustainable:

  • Vancouver will rise from 76 to 108 per cent
  • Metro Vancouver will rise from 49 to 66 per cent
  • Only Langley will remain affordable at 27 per cent

As wages continue to fail to keep pace with rising costs, ever larger portions of earned income will need to be devoted to housing costs, limiting disposable income for other expenses such as food and clothing.

As a result, more families will have to revise their long term expectations toward what has typically been termed a starter home: the condominium. In the past 10 years, Vancouver condo prices have only increased 43 per cent, relative to the 126 per cent increase in the general market. This increasing gap threatens to strand families in their starter home, unable to accumulate the capital to take the leap to a detached unit.

Currently, the communities where home values are still affordable to the average resident are Maple Ridge, New Westminster, Pitt Meadows, Port Coquitlam and Langley. Yet, if trends are not reversed by a combination of public policy and changes in financial practices, even these communities will be unsustainable by 2030.

The report provides several recommendations to assist Millennials who want to stay in the communities they love including:

  • encouraging individuals to consider non-traditional housing options,
  • encouraging financial institutions to invest in affordable housing development, and
  • calling on governments to create zoning and tax incentives for affordable housing.

Vancity offers financial advice, workshops and products such as the Down Payment Mortgage Helper to assist residents in addressing the challenges of living in Metro Vancouver. The credit union also offers seminars to help residents determine whether buying is possible or whether renting is a better option and learning tools such as its First-time home buyer's hub to help them understand their home ownership options and make smart choices.

In addition to helping prospective homebuyers, Vancity invests in a continuum of stable and affordable housing including: emergency and homeless shelters, transition housing, not-for-profit or subsidized housing, cooperative housing, rental housing, and life leases.

Vancity is committed to redefining wealth and building healthy communities for its members. An important part of building a healthy community is understanding key concerns like affordability.

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Ryan McKinley, Vancity mortgage development manager:

"The dream of a family home is not dead, but does need an update for a new generation. We're going to need to learn to live in closer and more interdependent ways in order to find an affordable and more sustainable lifestyle. By helping families consider all their options, Vancity is not only assisting members in their pursuit of a new dream but also shaping the values of sustainable living in Metro Vancouver."

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About Vancity

Vancity is a values-based financial co-operative serving the needs of its more than 509,000 member-owners and their communities through 58 branches in Metro Vancouver, the Fraser Valley, Victoria and Squamish. As Canada's largest community credit union, Vancity uses its $18.6 billion in assets to help improve the financial well-being of its members while at the same time helping to develop healthy communities that are socially, economically and environmentally sustainable.

Tweet us @vancity and connect with us on facebook.com/Vancity.

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