We will see, if not now, in the near future, what rampant speculation has done to our communities.
Governments at all levels have taken a stab at trying to deal with the issue, creating affordable housing funds, partnering with agencies to build specialized housing for those of lesser means, and taxing speculation.
Much of it is too little to late and isn’t going to help folks who make an average salary and whose incomes don’t qualify for social housing but who must battle it out in the trenches with people with deeper pockets.
A recent analysis of figures provided by the Real Estate Board of Greater Vancouver shows prices are still rising in most areas, especially for townhouses and condos, which will soon be out of reach for the average consumer, while detached houses costing over $1 million are now the norm.
What realtors are seeing is that people are willing to sell, but there are fewer sales. Why is that?
It’s because prices have gone through the roof and consumers are wary.
Even traditionally affordable areas, such as Port Coquitlam, are no longer the region’s best kept secret as buyers have found the friendly city to be an ideal location and their enthusiasm is boosting prices. Similarly, Coquitlam and Port Moody are hot spots for real estate, with prices for single family houses rising more than 7% since this time last year.
Meanwhile, land costs are skyrocketing. In Port Moody, property for a school on the former Flavelle site that was initially expected to cost $9 million will now likely fetch $40.2 million for just 1.6 hectares.
Now it’s not uncommon for a family to pay over $1 million for a modest house, for a $4,000 a month mortgage, while older condos are $500,000, requiring a $2,000 mortgage, plus strata fees and possibly an additional assessment for repairs.
This is insane.
What it means is that families moving to these formerly affordable suburban areas will be stretched for cash. Their stress levels will go through the roof, leading to more need for counsellors and social services. Money will also be sucked out of the economy, hurting local businesses.
For too long, people have looked with glee at rising assessments, but when you can’t afford to move anywhere, those assessments don’t mean much, and if your sons, daughters, cousins, colleagues, friends, aunts and uncles can’t make ends meet, even on an average income, then something is terribly wrong.
