Despite all the announcements on housing affordability from the new David Eby government in Victoria, a recent report by one of Canada’s largest banks shows things on the ground have never been worse.
RBC’s latest “Housing Trends and Affordability” note paints a stunning picture of both the income needed to qualify for a mortgage in Vancouver, and the amount needed to pay that mortgage, as rising interest rates worsen the previously existing housing crisis in much of British Columbia.
You’d need a pre-tax household income of at least $268,000 to buy a typical home in Metro Vancouver these days, according to the report. The figure, which is the highest in Canadian history, is “astounding,” according to the bank. “What was already a very tough hurdle to clear is now nearly impossible for many potential purchasers,” wrote RBC.
Yet it is clear though that nothing – from a speculation tax, to a money-laundering crackdown, to a larger property wealth tax, to cooling-off periods on home purchases – has resulted in any meaningful improvement to affordability, either before or after the Bank of Canada’s decision to drive up interest rates.
“The premier has asked me to put together a housing strategy so that we can highlight and in particular address those two key challenges, which I do think if we get them right will bring the price down to a level where more people are able to afford it.” The new affordability report plays well for the Liberals, whose repeated calls for the NDP to show “results” in areas of affordability, housing and health care have proven effective attacks against the government’s credibility.His law to force municipalities to speed up approvals for new housing may one day bear fruit in the form of more supply – it’s just unlikely to do so in a meaningful way within 18 months, when his government next heads to the polls.
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