Chilliwack may be the last bastion of single-family home affordability in the Lower Mainland from here to Vancouver Island.
A report on housing affordability issued June 6 by Vancity of 30 municipalities found the ability for families to purchase homes in the suburban areas outside Vancouver is getting worse, but Chilliwack is still one of the most affordable.
“Buyers looking for affordable housing options used to be able to look to municipalities around Vancouver to find affordable options,” said Ryan McKinley, Vancity’s senior mortgage development manager. “While pockets of affordability still exist, they are disappearing as prices in the Fraser Valley and other parts of B.C. continue to rise.”
Much has been made of the extreme house price rises in Vancouver, but the report, “Home Stretch: Comparing housing affordability in B.C.’s hottest markets”, says that people moving farther afield are driving up prices in other communities.
“A ripple effect is being felt well into the Fraser Valley, with median sale prices … up 32 per cent in Delta, 30 per cent in Langley (township), 24 per cent in Abbotsford and 14 per cent in Chilliwack.”
And since the ripples of that effect are hitting Chilliwack last, it means the local prices are still the most reasonable out of an increasingly unreasonable bunch.
Overall, Chilliwack ranked fifth of 30 municipalities with a median sale price over the period in question of $385,000 and a gross debt service (GDS) ratio of 27.9 per cent. (The GDS ratio is the percentage of a household’s gross monthly income to cover all household costs.)
Tops was the City of Langley, which has a surfeit of attached homes and apartments. Second was Sooke, third Victoria and fourth Esquimalt. The top three least affordable communities were West Vancouver, Lions Bay and the District of North Vancouver.
For detached properties, Chilliwack ranked second out of 30 on the affordability measure with a median price of $480,950 and a 34.8 per cent GDS. For townhouses Chilliwack was fourth with a median price of $324,132 and a 23.5 per cent GDS.
But it was with apartments where Chilliwack was the most affordable out of 30 cities with a median price of just $174,500 over the period studied with a 12.6 per cent GDS.
“When it comes to detached homes, Metro Vancouver’s most affordable options exist in Chilliwack, though the only really affordable houses are found in Sooke,” the report says.
The definition of affordability used in the report, is the generally accepted measure of one third of a household’s income spent on mortgage, strata fees, property taxes and everything associated with home ownership.
The study used Statistics Canada data to compare median annual household incomes and average home sale prices for the 12-month-period ending Feb. 28, 2017. That income level was $74,637 in the Chilliwack census metropolitan area (CMA). To compare, Abbotsford-Mission’s was $73,800, Vancouver’s was $79,498 and Victoria’s was $90,361.
And while the prices seem relatively positive in Chilliwack, big changes are happening. The overall shift in affordability is down 13.4 per cent in Chilliwack. For detached homes, affordability is down year over year 17.9 per cent, for attached homes it’s down 19.2 per cent, and from a median price in 2016 of $135,000 to $174,500 in 2017, that’s a drop in affordability of 28.3 per cent. The market is, however, dynamic and last month (May 2017) 71 apartments sold in the Chilliwack and District Real Estate Board at an average price of $190,000.
Vancity notes that the numbers used identify trends that were happening before the onset of this spring’s home buying season. Unlike monthly real estate metrics, the report uses comprehensive data available from Landcor Data Corp. based on actual sales of new and resale properties, year over year.
Based on monthly data, prices are getting even higher in Chilliwack as the median sale price for May 2017 hit $458,000, up 10 per cent year over year.
@PeeJayAitch
paul.henderson@theprogress.com
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