June is generally a strong month for house prices in Canada, according to the Teranet-National Bank House Price Index. But this June, the index rose only 0.8% from May, compared to an average June increase of 1.2%. Once those “seasonal pressures” are removed from the index via seasonal adjustments, “the composite index would have retreated 0.4% in May and 0.5% in June,” the report said. Particular weak spots were Vancouver, Calgary, and Edmonton. But there were some warm-spots too.

Vancouver:

Just based on seasonality, house prices should have risen in Greater Vancouver, which was until mid-2018 one of the most splendid housing bubbles in the world, where house prices had more than quadrupled in 16 years. But instead, they declined in June for the 11th month in a row, according to the June Teranet-National Bank House Price Index. The index is now down 5.2% from the peak in July 2018, the sharpest 11-month decline since Aug 2009….CLICK for complete article

Vancouver real estate is hella expensive, but it’s become ridiculous in recent years. Canadian Centre for Policy Alternatives (CCPA) crunched the numbers to find the wage needed to rent in Greater Vancouver. Breaking down the numbers further, we see how unsustainable the region has become. The average one-bedroom is now unaffordable to over half of the city. That’s if we include distant suburbs, and it’s even worse if we don’t.

Housing Affordability

Just because you can make the payments and not go into arrears, does not mean your housing is affordable. The term “affordable” is thrown around a lot, but there’s an actual definition used by the government. For housing to be affordable, shelter expenses need to represent less than 30% of gross (a.k.a. pre-tax) income. Shelter expenses include, but are not limited to, rent, mortgage payments, utilities, taxes. This is the definition used by the CCPA to determine “affordable.”…CLICK for complete article