It's now official: British Columbia's capital has one of the most expensive housing markets in the world.
Included in Demographia's annual international housing affordability survey for the first time last year, Victoria shot to 23rd place in the 25 most unaffordable housing markets in the world. It shares that spot with Sacramento in California, Sarasota in Florida, and Melbourne, Australia.
The survey rated housing affordability in Canada, Australia, the United States, Ireland, New Zealand and the United Kingdom.
If the median house price is over five times the median household income, the survey places those cities in the "severely unaffordable" bracket. So in Victoria, it would cost 6.6 times the median household income of $55,900 to purchase a house worth $370,000.
Vancouver, the only other Canadian city to make it into the top 25, was placed in the13th spot, requiring 7.7 times the median income of $58,100 to buy a house worth $448,800.
Of the many cities in the six countries surveyed, Los Angeles-Orange County topped the lot, giving it a median multiple of 11.4, almost four times the historical affordability standard of 3.0.
"Housing affordability has diminished so much in Los Angeles that less than 2 percent of Los Angeles households can afford the median priced house," stated the report.
San Diego, Honolulu, and San Francisco followed L.A.'s number one spot, with many other areas in California ranking in the severely unaffordable category. Sydney, London, and Perth ranked among the 10 least affordable housing markets. Dublin, the only city surveyed in Ireland, also rated severely unaffordable.
However, Canada rated the best overall performance of all the countries surveyed. Canadians only require 3.2 years of annual income to buy a house, compared to 3.7 years for Americans, 5.5 years for Britons, and six years for New Zealand residents.
The report said the "most pervasive housing affordability crisis" is in Australia, which has an overall median multiple of 6.6, more than double the affordable standard.
In the most affordable housing category, Regina tied with Fort Wayne, Indiana, and Youngstown, Ohio. Other affordable Canadian cities are Quebec and Winnipeg, with median multiples of 2.0 or less. Although Oshawa has Canada's fastest-growing market, with the median house price at $222,900, housing so far remains affordable in that city.
Victoria is scoring high lately in the job market as well. According to Statistics Canada, Victoria had the sharpest reduction in unemployment last year, dropping from 6.7 percent in 2000 to 3.7 percent in 2006, giving it the third lowest unemployment rate in Canada. Abbotsford and non-metropolitan parts of BC also saw a drop in unemployment rates.
On the other side of the country, parts of industrial Quebec and Ontario experienced an increase in unemployment rates by as much as five percent over the same period.
The study found that Canada's 28 metropolitan areas accounted for nearly three-quarters of the growth in unemployment over the past six years. Non-metropolitan areas of Newfoundland and Labrador, Nova Scotia, New Brunswick, and Prince Edward Island all had poor performance rates. Unemployment rose in Windsor, Ontario resulting from layoffs in the manufacturing sector and the auto industry.
Feeds