#2 in NEWS 1130’S Top 10 of 2018: Metro Vancouver housing

VANCOUVER (NEWS 1130) – A tough market that’s affecting renters and homeowners alike continued into 2018, becoming one of the biggest municipal election issues across Metro Vancouver.

The average cost of a house in the region sitting just under $1 million throughout the year with the average 1 bedroom apartment costing renters over $1,500 a month, pushing homeowners and renters to pressure all levels of government to take action.

Renters rallying for affordable housing and expanded tenants rights and against renovictions and increased rent, while homeowners, also feeling the squeeze, called for government to rethink increased taxes and allowing more buildings in their neighborhood.

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“Housing affordability affects us all. The problem’s been ignored for too long and the consequences are being felt throughout BC with housing costs skyrocketing,” said BC’s Finance Minister Carole James while rolling out new measures targeting housing during the 2018 budget.

Speculation tax and a raise on the increased foreign buyers tax and school tax among the things ushered in by the province. A crack down on real estate loopholes and a new rental housing task force also introduced.

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In Vancouver, a restriction on short-term rentals on Airbnb and the allowance of duplexes in single-family areas was introduced as the city sees money from the first year of its empty homes tax.

LISTEN: NEWS 1130’s Monika Gul looks back on Metro Vancouver housing in 2018

 

With the year ending in declining sales, it’s believed some relief is coming for some people.

“There’s a lot of headwinds for the housing market going into 2019,” says Tom Davidoff, Professor of Urban Economics and Real Estate at UBC Sauder School of Business.

“There is certainly the possibility of a soft landing, but we’ve got declining sales, we’ve got several taxes at the provincial and local level operating now with empty homes, foreign buyer, speculation, 3 million plus additional school tax, and then you tack onto that the stress test for every kind of bank issued mortgage and we’ve got now what looks like a recession if you look at bond markets.”

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Even the rise in rent seems to have slowed down.

“I think that’s true, you know a couple of years ago rents were rising at something like 10 per cent per year, I don’t think they’re rising that fast now,” said Davidoff.

“I think at least the rate of growth may have slowed and you know conceivably that could have something to do with empty homes and speculation tax or it could just be a slow down in the market.”

Davidoff says with so many things being thrown at the market all at once, it’s hard to pinpoint which new measures are driving the market.

“A lot of people attribute the stress test at the federal level, extended to all loans away from just insured loans that started in late 2017. But you also have the speculation tax introduced and there’s a lot of hand wringing about that,” added Davidoff.

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“There’s no question that adding a significant property tax at the higher end is going to reduce property values at the higher end, it’s hard to imagine otherwise so you’ve had that introduced this year.”

Davidoff adds 2018 was the year we started to see the real differences between homeowners and renters.

“Nobody wants people to launder dirty money in Vancouver, that’s an easy one, of course almost everybody is against that,” said Davidoff.

“But when it comes to do we wanna allow duplexes or other denser forms of housing in single family neighborhoods and do we wanna increase property taxes to take the load off renters? That’s more controversial.”

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