It’s early January. We’re shaking off the after-effects of holidays, resolving to pick up some better habits, and our property assessments, like our waistlines, continue to grow.
But unlike in previous years when we saw properties in some neighbourhoods jump 30 per cent or more, the increases are more modest this year, more in keeping with historical norms, according to BC Assessment.
It’s anyone’s guess as to why the increases have slowed but there have been a number of government policies put in place that could have an impact: the foreign buyers tax and new stress test rules making it tougher to qualify for a mortgage if you can’t afford a hike in interest rates.
It’s the condo market now that is showing the most froth. According to recent real estate board stats, in North Vancouver, apartments are up 23.5 per cent since 2016 with a benchmark price of $566,000. That’s still a far cry from “affordable” in a city where the average household income is just above $75,000. But with single-family homes here averaging just under $1.7 million, condos may be the only option for many buyers. There’s also the matter of downsizers cashing out from their single-family homes and looking for something smaller and more central.
In the past, we’ve prodded senior levels of government to take action to address our out-of-control housing market. To their credit, it may now be working.
There is some irony that the new mortgage rules will make it harder for first-time buyers to join the market, but if the 2008 financial crisis taught us anything, it’s that it is dangerous to have too many people locked into mortgages they can’t afford.
Going forward, if affordability is what we’re after, we’d suggest it’s time for more targeted policies that address both supply and demand in our market, much like our New Year’s resolutions probably involve both diet and exercise.
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