Metro Vancouver, which has one of the most unaffordable housing markets in the world, lags behind other Canadian cities in terms of wage earnings, according to the latest data from Statistics Canada.
The census statistics, which were released last Wednesday, highlight the radical disconnect between local wages and exorbitant house prices, according to Andy Yan, director of The City Program at Simon Fraser University.
“It was really surprising to me that we have the 15th highest incomes in Metro Vancouver, even coming behind Toronto,” Yan said. “What we learned today is in Vancouver you are living in paradise, but your wages are in purgatory.”
The median total income for households in Metro Vancouver was $72,662 in 2015. In contrast, Calgary’s median total income was number one in the country, at $99,583, which contrasts sharply with the median nationwide household income ($70,336).
Average housing costs for Canadian cities won’t be released by Statistics Canada until October; however, based on general knowledge of real estate trends across the country, Yan said he can draw conclusions on the severity of Vancouver’s housing affordability crisis.
The latest national income figures support the argument that speculation and foreign investment are driving house prices in Vancouver and Toronto, whereas other national housing markets are generally aligned with local job markets.
“No matter where you live in Canada you will have some element of globalization, but it is particularly acute in Vancouver. The issue that urgently needs solving is to reconnect local incomes to local housing. But the difficulty is, you will need different [policies] for different cities,” Yan said.
A breakdown of income to housing affordability ratios
A comparison of Stats Can wage figures for 2015 with aggregate home prices (including detached, semi-detached, and condos) for the first quarter of 2017 reveals the acute challenges faced by Metro Vancouver wage earners.
In Vancouver, the average home costs just over $1.4m, according to the Royal LePage National House Price composite. Median total household income for 2015 in the city was $65,327, the latest census data showed. For the district of North Vancouver, median total income was $103,981, compared to an average home cost of under $1.4m.
In Richmond, the average house cost was just over $1m, and median total income was $65,241. In neighbouring Surrey, the average home cost $764,000, and the median total income was $77,494.
Wage earners in Alberta have it easier: Royal LePage’s composite shows that the average house in Calgary costs $460,000. This isn’t a major stretch for households, as their median total income is just under $100,000.
Edmonton, which has Canada’s second highest median total income ($94,447), has an average home cost of $382,000.
Regina and Saskatoon have similar income to housing affordability ratios. And Ottawa and Montreal are only slightly less affordable than the prairie cities.
Only Greater Toronto (where the average home costs $759,000 and the median household total income is $78,373) came close to matching Metro Vancouver’s housing affordability issue.