The city of Vancouver, British Columbia, Canada — and its surrounding area — has one of the most horrifically, criminally inflated housing markets I’ve ever seen.
A $1 million CAD home in Vancouver (Source)
Regardless of whether you’re renting or “buying,” surging housing costs in Vancouver and the Greater Vancouver Area have been displacing the population for years, and will probably continue to. Every year, more and more people move further and further away from Vancouver’s epicentre to decrease their living costs.
But here’s the sad truth: It doesn’t seem to matter where you move outside of Vancouver. This province’s market’s inflation issues are so systemic that you can’t evade them simply by living outside the city.
Here’s a glimpse at the housing market in Coquitlam, BC, a suburban area that’s about 30 minutes and 31.6km outside Vancouver. The average house costs somewhere between $1.5-2 million CAD:
Supposedly, Vancouver’s inflated housing market is the result of unchecked foreign investment and, in some cases, money laundering. And we Vancouverites laugh about it. We cry about it. But strangely, a lot of us don’t do anything about it.
I’m not a real estate market expert. I’m sure the inflated market is the result of many forces, and I won’t pretend to know which are to blame. But it’s pretty clear that this province has a housing affordability problem.
Worse yet, the problem isn’t exclusive to Vancouver. Real estate costs have apparently skyrocketed throughout Canada over 25x faster than the United States since 2005. But prior to 2005, both countries’ real estate markets were growing at a similar pace.
And while major cities in the United States share the affordability issues of Canadian cities, housing costs seem to drop dramatically outside city limits.
Here’s a glimpse at the housing market in Austin, Texas, a suburban area that’s about 25 minutes and 11.5 km outside Austin. The average house costs about $250,000 USD, which is about $320,000 CAD and 18% of the average home cost in Coquitlam, BC:
Here’s a glimpse at the housing market in Killeen, Texas, a suburban area that’s about 1 hour and 5 minutes and 109 km outside Austin. The average house costs about $150,000 USD, which is about $190,000 CAD and 29% of the average home cost in Chilliwack, BC:
Of course, these are different cities that offer different opportunities. They’re also separate countries with contrasting social benefits, taxation situations, economies, political climates, etc. A BC resident might proclaim that they’d “never want to live in Texas,” and vice-versa for Texans.
But the point is that you can run this experiment again and again by pitting the surrounding housing markets of Canadian cities (Vancouver, Toronto, and even Edmonton) to American cities (New York, Los Angeles, Portland, Austin, etc.) and real estate outside of American cities is almost always cheaper, even with the currency conversion.