Trent Ernst, Editor
While prices dropped over the last three months of 2012, BC still remains the priciest province to live in, according to a report by RBC Economics Research.
The Housing Trends and Affordability Report shows that, while prices continue to drop in the Vancouver area, it remains the most expensive place in Canada to own a home. According to the report, the price of owning a home is generally high across Canada, and the new homes are “accessible only because of rock-bottom mortgage rates.”
An increase in those rates could spell a disaster for the Canadian housing market, though rates are expected to remain low, though they might start creeping up sometime in 2014.
Fewer people bought homes in the last quarter of 2012 than earlier in the year, which lead to a slight drop in the total number of home resales from the year before. This is partially blamed on the Canadian government’s changes to mortgage insurance in August, which raises the bar for first-time buyers.
Ten years ago, household costs (including mortgage, utilities and taxes) ate up about 50 percent of household income in BC for people owning a two-storey house. By 2010, that number had climbed to well over 80 percent. At the end of 2012, that had dropped to 82.2 percent.
To compare, owning a two-storey home takes up less than 40 percent of the average Albertan’s household income and the national average is about 50 percent.
Because Vancouver is the largest market in BC, prices there skew the results for the rest of the province. The average cost for a detached bungalow in BC is $604,600. In Tumbler Ridge, prices start at $169,000 and go up to $399,000, averaging about a third of the provincial average.
Even in the Kelowna area, typically considered one of the more expensive areas of the province to live, the average price for a house was $467,800. In the North Okanagan, it was $353,500.