A study surveying housing affordability in the Capital region offers some familiar findings, which nonetheless come with a catch – they do not say anything about the largest community in the region: Saanich.
The study prepared by Van City calculates affordability by correlating median sale prices with the median household income for the larger metropolitan area in which the municipalities lie in calculating the gross debt service ratio (GDS).
It represents the percentage of a household’s gross monthly income required to cover mortgage costs, property taxes and maintenance such as strata fees and heating.
The study considered 30 communities spread across four Census Metropolitan Areas (CMAs): Victoria, Vancouver, as well as Abbotsford-Mission and Chilliwack.
Communities surveyed in the Capital region were: Victoria, Central Saanich, North Saanich, Oak Bay, Sidney, Sooke and Esquimalt. Saanich – the largest community on Vancouver Island with a population of nearly 115,000 and one of the largest stand-alone municipalities in the province – did not make the cut.
This choice is even more puzzling in light of the report’s headline: “Growing unaffordability hits suburbs hardest.”
In other words, the report identifies suburbs as one of the areas where housing affordability is a concern without describing the most important suburb outside the City of Victoria proper.
Susan Mohammad, a spokesperson for Van City, acknowledged the oversight. “I’ve looked into the question and we had to be a bit selective in creating a representative list to highlight trends, which is why there are gaps like the one you mentioned,” she said.
Turning to the findings, they confirm familiar trends. The report notes that detached homes in Victoria absorb 43 per cent of gross monthly income, whereas apartments absorb 20 per cent. Overall, the typical Victoria residence requires 26 of household income.
The report identifies Oak Bay as the least affordable of the municipalities in the Capital region. “Buyers of detached homes must consider paying 69 per cent of household income,” it read. Attached homes require 37 per cent of household income, while apartments have seen the “least pressure” in requiring 29 per cent of household income.
The report identifies Sidney as “upscale but relatively affordable, with detached and attached homes requiring about 36 per cent and 32 per cent of household income, respectively.” This said, Sidney’s affordability is declining, according to the report. “The past year saw the affordability of apartments decline 22 per cent – neck-and-neck with a 24 per cent deterioration in the affordability of detached homes – as demand strengthened.”
Sidney, in other words, is attracting buyers, increasingly shut out of other markets in the Greater Victoria area.
So which areas of the Greater Victoria area remain affordable? Sooke and Esquimalt.
“Sooke is one of those rare municipalities where everything is affordable by local standards, and even more so for those leaving the Lower Mainland,” it read. Sooke apartments require just 13 per cent of local income, whereas detached homes require 26 per cent of household income.
“Esquimalt, like Sooke, remains an affordable place to buy,” the report concludes. “The typical residence now requires 27 per cent of household income, a modest decline from last year,” it read. “The more affordable property types took the greatest hit to affordability over the past year, with attached and apartment properties becoming more than a fifth less affordable.”