A week or so ago, I published the first post in this series which showed that a typical townhouse in Grandview was completely out of reach for the median income family in Vancouver.
Some people may have thought that a high-end townhouse was a bad example to use, even though they are being pushed on us as “affordable” alternatives in the Grandview Community Plan. Therefore, today, I present to you a 706 sq ft one-bedroom apartment currently on sale for $738,000.
Assuming our purchasing couple making the median Vancouver family income of $75,000 has somehow managed to secure the $73,800 down payment, their combined income is still barely half the $139,107 needed to qualify for a mortgage.
Even if the bank or other lender looked the other way on their income qualification (highly unlikely), the annual mortgage payments of $36,612 would be 49% of their gross income, and probably closer to 80% of their net after taxes and deductions. This is, of course, way above the 30% of gross considered as the definition of affordable.
None of this is new news, but it cannot be repeated enough that the housing market in Vancouver is in a crisis of affordability. Most of our population cannot even consider buying anything whether it be a house, a townhouse, or even a tiny apartment. And when the other alternative — purpose built rentals — are being offered at rates well above affordability, then we know the market is truly broken and Vancouver has become a ghetto for the privileged only.
The government in Victoria presented us yesterday with some high-flown rhetoric concerning affordability: the proof of the pudding will be in the budget next week and whatever specific proposals are made thereafter. We cannot wait any longer.