Our criteria is to try and pay the same mortgage-only amount that we’re already paying in rent ($1600 for the main floor of a house in central Vancouver). Doing this does seem quite feasable if we were to find a bungalow or small 2-level that has a basement suite rental (the vacancy rate here is quite low) in up-and-coming central neighborhoods. Decently-maintained homes like that, in those neighborhoods, are asking, very roughly, $580K – $715K.

I think it’s important to keep in mind that as an investor-slash-proud homeowner, one isn’t about to buy just anywhere in “Vancouver”, or in any city for that matter, but of course one tries to find the best potential value by buying in relatively underpriced micro locations that are likely to grow and become more desireable. My sense is that locations that are already very (okay, insanely) expensive–can you say, “Kitsilano”?–are in a way riskier. I mean, I’ve seen houses a few blocks west of Main that are comparable to ones a few blocks east of Main, yet their asking price is $100K more! Which side of the street would you buy on? I also have a sense that the condo market has pretty much reached a glut-level supply, and is looking vulnerable to a correction.

On the other hand, a great screenwriter once said about making successful movies, “Nobody knows anything”, and I think that’s probably applicable to making pronouncements about Vancouver real estate. I think a more accurate comparison than NY or London is San Francisco: we’re a peninsula, the climate’s mild, the growing season’s long, the outdoor pursuits are endless, the natural environment is stunning. Our realtor tells us that Albertans are investing in houses here, which is adding to demand. Who really knows what effect the Olympics will have on the market–the only thing certain is we’ll get a lot of new rec. facilities out of it.

[...] 70% of Gross Income Needed for Vancouver Homes! (29 comments) [...]

renting is usually a financial decision. Buying a home is usually only partly driven by financial considerations.

Couldn’t have put it better.

I’m seeing the same stuff in Edmonton, tons of new places, but I knew that it had to happen b/c the economy was going to burst. I don’t think that prices are going to suppress back down to 5 years ago, but they will drop 5% off January’s highs. We’ll see how long the madness lasts though. We may have solved the “home crisis” for this upcoming year, but the real issue here is getting rents that are affordable for “the masses”. Starting Tim Horton’s at $11/hour doesn’t do anything when the rents all cost 1000+.

With house prices where they are, rent will either go down (and be a bargain) or businesses will be forced to jack up prices ($2 for an XL double-double) to keep up with wage increases.

It sounds like Saskatchewan is already growing pretty strong, it’s definitely being advertised as a bargain, and Edmontonians who bought in the last few years just won the housing lottery, but only if they’re willing to move elsewhere and cash in their gains :)

Instead I have adopted the strategy of renting in a very nice downtown location for about $900.00 a month and saving and investing the difference that I would be paying in a mortage. Maybe one day there will be a market correction…that is when I will buy….

Why are prices so high….well it is not the wages…the average working person I would say earns from $35,000 – $65,000…I think it is because Vancouver is a nice place to live and I see a lot of wealthy foreign buyers buying up properties as a summer place or a secondary property. Vancouver prices are still reasonable when compared to New York or London. The only problem is that the average workers wages are stuck at levels more in-line with places like Winnipeg or Hamilton…

Depending on the area and type of housing, it’s $320-$600/sqft here.

Edmonton has been historically cheap and most of the price run up was a realignment to match the big city status. But speculators and emotions are running it up higher than it should be.

I also see a lot of ads for Saskatchewan extolling the virtues and cheap land.

And you’re right about the oil money, but only somewhat. You see, we’re undergoing some massive growing pains right now. The Edmonton rental market is getting out of a decades-long slump and now apartments everywhere are full and the renters are jacking up the prices. One bedroom apartments in non-prime locations are going for 1000+ / month.

So even though every McWorker is bringing in $10/hour, they’re not doing much better than than those in Manitoba bringing in $8/hour and renting for $600/month. So wage increases are matching housing prices increases (and vice-versa) creating a kind of parity.

So Edmontonians home buyers are a little less crazy than Vancouverites home buyers, but the situation is still a little out of hand. Making 80k here instead of 65k in say Saskatchewan, doesn’t really justify the difference between the 300k Edmonton home vs. the 100k SK home. In fact, given the serious issues with build quality over the last few years in Edmonton, that SK home is probably a safer bet.

As to those Vancouverites? Well, they’re making a serious “lifestyle” decision to own a Vancouver home, b/c there is little inherent value to a Vancouver home that makes it worth 4 times as much :)

For years, Vancouver was called Hong-couver for the large Hong Kong ex-pat community. Now the city has Hong Kong style real estate prices!

I don’t have the stats, but housing prices in Edmonton and Calgary over the last two years have increase more significantly than Vancouver; but the average salary in the oil industry has also gone up to support the housing increases.

Typical downtown prices start at around $550/sf and go up to $1000/sf for the best quality places in the most desirable neighbourhoods. So for a decently big 1000sf place you’re looking at $550k-$1m.

I work with Western market right now and the same house would probably sell over 700k in Surrey BC per example. This is just crazy !