The Novum Times

To buy a home in Vancouver you need to earn at least $235,650 a year

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The Ratehub.ca report says Vancouver had the biggest increase in the average cost of a home in June — up $15,000 to $1,203,000.

Published Jul 18, 2023  •  Last updated 42 minutes ago  •  2 minute read

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File photo. Photo by Jason Payne /PNG

As Metro Vancouver real estate prices continue to soar, a new report finds that residents would need another $8,850 in additional income to buy a property.

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The Ratehub.ca report Tuesday says of the 10 cities it ranks, all of them got worse affordability, but Vancouver had the biggest increase in the average cost of a home in June — up $15,000 to $1,203,000.

The jump in Vancouver home prices, combined with higher interest rates and stress tests, means that a buyer would need a salary of $235,650 to buy a home in Metro Vancouver last month, up from $226,800 in May.

Vancouver’s average home price increases were more than double the rate of the next two cities: Toronto, which was up $6,900 to an average home price of $1,171,300; And Victoria, which was up $6,500 to $885,100.

Data for the report is based on a mortgage with 20 per cent down payment, 25-year amortization, $4,000 annual property taxes and $150 monthly heating. For Vancouver, the average price of a home is based on the Canadian Real Estate Association’s data for Greater Vancouver.

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Ratehub compares month-over-month national real estate data, and then factors in the minimum income required to purchase an average home in each market, based on changes in mortgage rates, stress test rates and real estate prices.

Hamilton saw the average home prices decline by the largest margin, to an average of $873,100 — but it wasn’t enough to move the dial on affordability, according to Ratehub.

“Hamilton saw the biggest home price decrease month over month, but despite this home affordability still worsened due to higher stress test and mortgage rates,” said James Laird, Co-CEO of Ratehub.ca, in a statement Tuesday.

Canada’s central bank recently hiked its key interest rate to the highest it’s been since 2001, playing what some call a dangerous game.

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The central bank hiked its key interest rate by a quarter of a percentage point last week, bringing it to five per cent, the 10th consecutive rate hike since March 2022.

B.C. premier David Eby said the latest interest rate hike is “devastating news for families” and he doesn’t believe in “solutions that come at the expense of the poorest people.”

ticrawford@postmedia.com

—with files from Kate DeRosa

Tiffany and Jason Verhagen are struggling to pay their mortgage after the recent interest rate hikes.

‘They’re drowning’: Latest interest rate hike hits B.C., Canadian homeowners hard

File photo. New disclosure forms will inform home buyers about many bids there are on a property.

Buying a home in Metro Vancouver? New forms provide information about competing bids

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