Skip to content
Join our Newsletter

Average Metro Vancouver home costs four times more than Millennials can afford

The average home in Metro Vancouver is priced at more than four times what a typical Millennial can afford, according to a study released June 13 by housing advocacy group Generation Squeeze.

The average home in Metro Vancouver is priced at more than four times what a typical Millennial can afford, according to a study released June 13 by housing advocacy group Generation Squeeze.

The million-dollar-plus price tag for an average home in the region would have to be reduced by $795,000 – about three-quarters of the current value – to under $250,000 to be achievable for a 25-34-year-old on a typical annual salary, according to Straddling the Gap.

 Couple wants to buy a home/ShutterstockCouple wants to buy a home/Shutterstock

That’s based on the buyer spending 30 per cent of their income on mortgage payments, having a 20 per cent down payment, and on current available interest rates.

Alternatively, a buyer’s typical full-time earnings would need to increase to $200,400 per year – nearly four times current levels – to afford the average Metro Vancouver home, said the report. It added, “Based on the last decade, actual earnings are expected to be flat.”

The report also said that a Millennial buyer saving for a 20 down payment on an average priced home ($1,050,000) would take 29 years, if saving 15 per cent of their typical pre-tax income each year. That’s longer than some of those buyers have been alive, and 23 years more than in the mid-1980s when some of their boomer parents were buying homes.

A look at the region’s MLS reveals only a couple of dozen homes currently available under the affordable $250K price tag, not counting manufactured homes and fractional ownership.

 Source: Generation SqueezeSource: Generation Squeeze

Across B.C., the report said that average home prices would need to fall $452,000 – about two-thirds of the current value – to achieve the $250K price tag affordable for a typical Millennial buyer, or salaries would need to triple. The number of years to save for a down payment on an average home in the province (just over $700K) is 19 years.

Generation Squeeze is working with the Canada Mortgage and Housing Corporation, and makes a number of recommendations to help improve general affordability for young Canadians. These include:

  • Reducing or removing other large, non-housing expenses – such as child care and parental leave, student debt and tuition, transit costs and more;
  • Building more purpose-built rental housing to accommodate the fact that people are renting longer;
  • Capture housing wealth windfalls through taxation, and remove tax-sheltered gains in housing;
  • Revitalize B.C. economy to improve earnings, with less reliance on real estate and development for GDP;
  • Find new measures to de-risk the market in order to bring down home costs in ways that support all Canadians, including those who already own property; and
  • Protect the housing market from inflation in regions where affordability has not already been lost.