It’s no secret that buying a home in Vancouver is next to impossible for many young people, but a new study suggests millennials in the city have the least purchasing power in the entire nation.
The report from Vancity Credit Union notes that millennials who purchase homes in Vancouver at an average price can expect to go into debt by nearly $3,000 a year thanks to an imbalance in property values and salaries.
The average millennial couple earned a combined annual salary of $72,291 in 2015, which Vancity says is the second lowest rate in Canada. After essentials are paid for – think taxes, clothes, utilities, and everything that allows you to function in life – they’re left with $41,609. After homeownership costs of $44,354 are subtracted, millennial couples are left with an annual debt of $2,745.
When children and childcare are thrown into the mix, that yearly debt skyrockets to a whopping $17,325 annually.
“The status quo isn’t good enough if we want this generation to be able to put down roots, possibly have a family and still enjoy a basic quality of life in Vancouver and Victoria,” says Vancity’s vice-president of community investment William Azaroff in a release.
When comparing Vancouver to Victoria, the disparities are even more apparent. Millennial homeowners in Victoria are left with a discretionary income of $12,200 a year, rather than the yearly debt that their Vancouver counterparts experience.
Even in Toronto, the second worst housing market in the nation, millennial homeowners are left with a yearly discretionary income of $3,379.
Young homeowners in Canada might want to consider packing up and moving to Edmonton, though – millennials in the city have $47,000 in discretionary income, the highest in Canada.
The report notes that Vancouver millennials may have to reconsider home ownership as a means to generate wealth.