The Middle Class is Priced Out

The CBC has an article looking at the situation for middle-class home shoppers in Vancouver BC.  They’ve noticed that incomes have dropped since the 70s while prices have risen.

So if you’re middle class in Vancouver you’re either priced out forever or something is going to change.

From that article:

Lawyer Nathan Hume and health researcher Angie Chan live with their two young children in a rented two-bedroom apartment in Vancouver.

With two good jobs, they had hoped home ownership in the city would be within their reach. But sky-high prices in Vancouver have left them without any options.

“We have a number of friends who are in the same situation as us — highly educated, they’ve got good jobs, they have young kids, and they’ve all left the city,” said Chan.

Hume says it is likely they could get a mortgage to buy something, but they don’t think that’s smart, when it would mean foregoing savings for retirement and their childrens’ education.

Any readers here have friends who have moved away from Vancouver simply do to house price dynamics?  Any of you considering a move away based purely on the cost of housing?
Read the full article at the CBC web site.
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vanhattan
Member
vanhattan
Count me in on a Vancouver real estate causality. Before I start I have to say that I am very thankful to be even more fortunate than most but Vancouver simple did not add up anymore. I was living in a nice 2/2 condo downtown…yes, probably better than most but we wanted to live in a single family home again. My income was just north of 200K/year and I simply could not understand how 90% of folks could afford Vancouver. We simply could not find a decent house that we could afford on the west side or in west vancouver. In addition, good jobs were/are scarce and I was paranoid of buying up with no real job prospects should my job go bust. So after much soul searching tossed in the towel and packed up for another expensive enclave, San… Read more »
Anonymous
Guest
Anonymous

@patriotz:

I agree with what you say but it was intellectually dishonest of RentersRant to claim that tuition costs over 6 figures for a basic degree. Anyways like many other things, the decision to get a certain type of education should be based on value received. I do agree that trades are looking much better relative to college degrees since opportunity and tuition costs are much lower with trades yet wages are on par or higher in a lot of cases.

fixie guy
Guest
fixie guy

81 Best place on meth Says: “It’s LA with shitty weather.”

Why so harsh on LA? Not my city of choice either but no one can deny the extraordinary global influence of its culture via Hollywood. Vancouver’s global influence is Lion’s Gate?

Bilbo Bloggins
Guest
Bilbo Bloggins

@jesse:
Connie darling, your $900+K wouldn’t buy a handyman special on Main St.
Don’t even think about stepping foot in Hongcouver without at least $2.5M you poser.

Tick Tock
Guest
Tick Tock

@ Vangrl

We could all pitch in and get their hopes up by pre-registering!

I just did

http://www.gvhba.org

Preying on the 1st timers, pretty low.

RippedtoShit
Guest
RippedtoShit

Dummies.

The pension funds are dramatically overweight bonds/safety and underweight stocks (growth and value companies).

The pendulum swings both ways, and I am hopeful/of the view that it is at the early stages of swinging back. Chumps.

Watch for listings to start rising once the budget comes down.

Idiots.

VultureBoy
Guest
VultureBoy

@Girlbear: I ignore the market and pick stocks. For decades now 100% market… You have huge advantages over money managers, eg, long time horizons, ability to buy thinly traded stocks, no fear of losing your job due to your trading choices… there exist those who have inside information, so avoid short time horizons.

Urbain
Member
Urbain

@Anonymous: Fair enough. I didn’t get that from your original comment.

good-format
Guest
good-format
Copied from PaulB’s number http://www.laurenandpaul.ca Date Listing Price(+-) Sold Inv Inv(+-) S/L(%) Mar 01 313 94 123 14,912 5 39.3 Mar 02 251 97 163 14,919 7 64.9 Mar 05 338 134 118 15,069 150 34.9 Mar 06 298 114 163 15,161 92 54.7 Mar-07 260 114 71 15,305 144 27.3 Mar-08 237 106 152 15,345 40 64.1 Mar-09 229 76 69 15,454 109 30.1 Mar-12 306 119 120 15,588 134 39.2 Mar-13 290 122 146 15,640 52 50.3 Mar-14 238 97 133 15,701 61 55.9 Total-Cur 2,760 1,073 1,258 794 45.6 5 day-avg 260 104 124 79 47.7 Total-Est 5880 2,321 2,746 16,651 1,824 46.7 Historical March Sold and listing Year Sold Listing S/L(%) 2001 2,315 3,805 60.8 2002 3,392 5,168 65.6 2003 3,304 4,272 77.3 2004 4,371 5,709 76.6 2005 3,938 5,083 77.5 2006 4,033 5,767 69.9 2007… Read more »
Anonymous
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Anonymous
@McLovin: A lot of it has to do with the way financial transactions are being regulated in the states. Most of the volume is done through high frequency trading programs. The trading houses have their own systems that work of algorithms holding shares for sometimes less then a millisecond. They deposit lets say 20 million in a bank account as collateral, but since they trade so often there is no way to transfer money from account holder to account holder. So they just settle at the end of the day. This allows traders to hold huge positions without actually putting anything on the table. There has been days in the past were HFT has accounted for over 50% of volume sometimes even close to 75% of that days volume. So as regulation becomes more strict in the way that this… Read more »
Girlbear
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Girlbear

@McLovin: The “average person” never owned stocks. Google it for some history. This “rally” is not meaningful bc it is led by the small retail crowd, hence the low volume. It’s not the average person who is scared shitless – it is the portfolio manager who is. And rightly so. Yeah Greece is fixed. uh huh. and spain, and portugal, and italy…

McLovin
Guest
McLovin

Sorry Girlbear gotta disagree with you.

The reason there is no volume behind them is the average American is shit scared and is completely out of stocks and may never come back. 2008 and then June 2011 of last year was a “generational washout” very few people own stocks any more. The average pension plan is 50% underweight on their long term average equity holdings.

Lastly, the high frequency traders have gone to the side lines because there is not enough volatility for them to scalp their profits leading to lower volume.

I am sure many will disagree and that is fine, that’s what makes a market.

McLovin
Guest
McLovin

Hey Bull Market why are you drawing a parallel between the Dow and YVR housing?

I have lots of blue chip US Multinationals that are doing a lot better than YVR real estate lately and I am a renter in Vancouver.

What is your point?

Girlbear
Guest
Girlbear

@Bull-Market: You do realize that the “new highs” have no volume behind them right? Meaning there is no institutional money backing this. These news highs do no matter until the real money gets behind it. Which it is not so far.

Bull-Market
Guest
Bull-Market

No matter how you guys complain, it’s not going to help. Housing prices will continue to rise. Too bad. Suck it up or move elsewhere. Dow Jones is rocketing to new highs, what else is new. Economy’s recovering. You got one last chance to buy now or cry next year. I watched that video of the couple, one lawyer and one health researcher. They’re stupid, they should’ve bought last year. They can still buy now before another 20% increase in property prices. They had no balls to load up. Life sucks. You win some and you lose some.

YLTN @ Work
Guest
YLTN @ Work

@procrustes: IMO any report trying to match census income data with anything in the lower mainland is bunk due to too much undeclared income from the likes of offshore families, under the table construction labour and the drug trade.

jumpin in
Guest
jumpin in

http://business.financialpost.com/2012/03/14/china-warns-of-property-chaos/

Chinese Premier Wen Jiabao said that home prices remain far from a reasonable level and relaxing curbs could cause “chaos” in the market, indicating no imminent relaxation of cooling measures.

Anonymous
Guest
Anonymous

@Urbain:

My point is that Vancouver is still many years away from sensible prices.

Best place on meth
Member
Best place on meth

@Makaya:

Correct.

It’s LA with shitty weather.

Makaya
Member
Makaya

From Garth tonight:

Vancouver has taken the title from Calgary as the most materialistic, self-obsessed, wealth-conscious and socially unattractive city in the nation. And it was a tough fight.

I know it but yet still feel sad about it…

Patiently Waiting
Member
Patiently Waiting
The story below comes as no shock to me. My wife works in a carehome alongside many recent immigrants from around the world. She says lunchroom chat is often about how bad family housing is here and stories of better housing from friends and relatives in other parts of Canada. Its not just the high priced real estate that’s killing Vancouver, but the abysmal rental housing too. Even people from the third world know this place is a dump. http://www.news1130.com/news/local/article/341005–immigrants-out-of-big-cities-due-to-affordability-study Immigrants may be contributing to a growing population in places like Kelowna and Victoria because of the affordable housing problem in Vancouver. A UBC-lead study has found many of those immigrants spent 75 per cent or more of their income on housing. “[They are] following the job market but also I think housing dynamics play a role in that as… Read more »
vangrl
Member
vangrl

http://www.vancouversun.com/business/mortgages/Seminar+will+clear+first+time+homebuyers/6282567/story.html

or
Realtors will try and push more young folks into the biggest mistake of their lives

chip
Guest
chip

@jesse:

That’s story pretty weak. The fall and rise in Orange County isn’t much different from the rest of So Cal, and the only evidence for Asian buyers affecting things is an anecdote from a local mortgage broker.

Best place on meth
Member
Best place on meth

The CTV piece on Kelowna was short but sweet.

The best part was at the end when the sad looking realtor said something along the lines of “as soon as the world economy sorts itself out things here will turn around again”.

Poor guy, he has no idea.