key2thecup Posted April 2, 2015 Share Posted April 2, 2015 Average detached home in Vancouver to cost $2.1M by 2030: report A new study is painting a bleak picture for young people when it comes to owning a home in Vancouver. That’s because by 2030, the average detached home price in Vancouver will exceed $2.1-million, according to an alarming Vancity Credit Union Report called “Downsizing the Canadian Dream: Homeownership Realities for Millenials and Beyond.” As the generation called millennials grow up, start families and look to buy homes, “many will have to revise their goals to accommodate rising unaffordability in Metro Vancouver,” the report says. It goes on to say that in the future, mortgage payments will eat up the majority of most households’ income, and in some cases, it will even cost more. While experts and lenders recommend payments not exceed more than 32 per cent of monthly household income, the average Vancouver homeowner spends closer to 42 per cent of their monthly take. By 2030, that percentage could shoot up to 108 per cent, the report says. “The takeaway is that we really need to stop talking and really come up with policies and strategies that will help people to buy homes in the future,” said Andy Broderick, vice-president of community investment at Vancity. “I don’t think the dream [of home ownership] is dead. There’s lots that can be done.” While most might assume the millennial generation wants to rent a breezy loft in a hip urban core, the study suggests nearly three-quarters of millennials say they eventually want to own a detached home. That could include settling for condos instead of the traditional white picket fence home, Broderick said. While average home prices have increased by 126 per cent in the last decade, condo prices have risen by only 43 per cent. Still, Vancity predicts the average condo price will double in the next 15 years to more than $800,000, and those costs will likely be passed on. “The rental market is getting tighter and tighter, and it’s going to continue to,” Broderick said. Those who don’t want to shell out big bucks for a 500-square-foot apartment may think there are cheaper options east of downtown Vancouver, but the report says even Metro Vancouver’s suburbs have seen a sharp increase in home prices. In fact, it says the only affordable community to buy a home 15 years from now will be Langley. “With average property values projected to remain stable at around $525,000, an average household should be able to cover housing expenses with only 26.8 per cent of their income,” it says. Vancity recommend millennial buyers set up a plan outlining their goals for home ownership, and if it doesn’t make sense to buy one, set up a savings plan to build long-term equity. The benchmark price for a detached property in Metro Vancouver is $1,026,300, according to the Real Estate Board of Greater Vancouver. http://bc.ctvnews.ca/average-detached-home-in-vancouver-to-cost-2-1m-by-2030-report-1.2296918 Vancouver homes prices will climb to $2.1 million by 2030: report Vancity Credit Union report says new homebuyers should lower their expectations A new housing report from the VanCity Credit Union says the average house price in Vancouver will climb to $2.1 million within 15 years. Andy Broderick, Vancity's vice-president of community investment, says future homebuyers who want to stay in the Lower Mainland should lower their expectations of what they'll be able to afford to buy. "We'll be looking at more and more comfort with condo ownership, with living in denser conditions," says Broderick. The likelihood of new buyers owning a house with a white picket fence is pretty much nil as the report highlights that wages are not growing at anywhere near the same pace as housing prices. Broderick says the desirability of living in Metro Vancouver is to blame. "You're here for the very reasons that the place is unaffordable," says Broderick. "Realize that you may not be able to buy the kind of house you'd buy far up the Fraser Valley." The report highlights that although Vancouver is the second-most unaffordable city in the world, it's also been named the third-most liveable city in the world. But the report also mentions that the cost of condos will rise as well, leaving the most affordable options in Metro Vancouver cities like Langley, Port Moody and Coquitlam. Focus on millennials The report focuses on home ownership for millennials, or those born approximately between 1980 and the early 2000s. However, a recent report from U.S.-based Federated Investors highlighted that millennials in North America stand to inherit $30 trillion over the next few decades. And a recent housing report from the Vancouver-based Urban Futures Institute showed that despite climbing home and condo prices, millennials were more likely to own a home in 2011 than they were in 2006. And yes, that pattern was the same specifically for the Metro Vancouver region as well. Broderick says the exponential rise in the cost of home ownership is not inevitable. "I think we all have to elevate our awareness of the problem and start asking our municipalities and our provincial government to pull together to come up with solutions," he says. Some of the Vancity report's recommendations for various levels of government include changing zoning to increase density, creating affordable housing, and changing tax structures to create incentives for developers. http://www.cbc.ca/news/canada/british-columbia/vancouver-homes-prices-will-climb-to-2-1-million-by-2030-report-1.3009944 Link to comment Share on other sites More sharing options...
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