While Vancouver ranks as having the least affordable housing market in Canada, it is third least affordable in the world, according to a new study.
Vancouver only falls behind Sydney, Australia in second place and Hong Kong, China in first, as ranked by the 12th Annual Demographia International Housing Affordability Survey, which gives third quarter 2015 results.
The study also noted Vancouver was fourth most vulnerable among the cities surveyed for a real estate bubble risk, despite the forecast of a rise in the median price of a detached home to $2.1 million over the next 15 years. That’s nearly double the current median price of a detached home in Vancouver at $1.2 million.
B.C. had four cities in the top five of the least affordable in Canada: Vancouver came in first, Victoria second, the Fraser Valley fourth, and Kelowna fifth. Toronto took the third place spot.
The situation in Vancouver has been described by some experts as a crisis. The lack of affordability in the city will cause the housing market to slow in 2016, Royal Le page predicts, although increases will still happen.
In 2015, the price of a starter bungalow increased 16.8% year-over-year, but it’s predicted it will only increase 9% this year.
In Metro Vancouver, RE/MAX is predicting the average price of a detached home will break the million dollar mark in 2016.
Nationally, Canada is rated by the DIHAS as “moderately unaffordable.”
Not to fret, though – there are still affordable places to live in Canada. Moncton and Saint John – both in New Brunswick – tied for the most affordable places to live nationally. Fredericton, Saugenay, Charlottetown, Trois-Rivières, Windsor, Thunder Bay, and Sudbury were also considered very affordable spots to live in Canada, according to the survey.
In the same survey last year, Vancouver was ranked as the second least affordable housing market in the world, only topped by Hong Kong. Sydney came in third.
The study surveyed Australia, Canada, China, Ireland, Japan, New Zealand, Singapore, the United Kingdom, and the United States.