A recent survey shows Vancouver is now the second most unaffordable housing market in the world.
Vancouver jumped up a spot from last year, leap-frogging over Sydney, Australia. Now, in second spot, we only trail Hong Kong.
Wendell Cox is with Demographia, who conduct the annual surveys indicate that Vancouver needs to do a better job of allowing development in urban areas, a problem not unique to the Vancouver region.
“We have seen London’s market ruined, Sydney, Melbourne, Toronto more recently. Virtually all of those places have urban containment policy,” Cox says. But in Vancouver: “You have a very strong urban growth boundary, you do not allow any peripheral development as a result for the most part. This has driven the price of what little land can be developed up very high.”
And Cox says it’s likely not going to get any better.
“You have one real bad problem and it’s likely, in the long run, prices are going to pick up and take off again.” He says in the end, it’s the younger generation getting the short-end of the stick.
“The burden that is being put on younger people at this point, the increases in poverty that are occurring because people can’t afford decent housing – these are very serious problems.”
And it’s not just bad news for people who can’t afford to buy a place to live.
“Business types and so on are concerned about the long-term economic impact on the competitiveness of the Lower Mainland,” Cox says. “There is good reason to be concerned about this.”
He says it looks like the measures put in place to slow the market down, including the foreign buyers tax, are hitting the higher end of the market.
“The middle of the market has continued to go up, not at the rate that was happening before, but it has continued to go up.”
He says if governments really want to tackle the problem, they should start by looking at more suburban-type development in urban areas, and take a second look at land regulations.
For the past three years, Vancouver has been in spot number three in the Demographia survey, but had been in spot two before that. Source: News1130