Vancouver is awash with detached houses reaching the $1-million milestone as the affordability crisis hangs over the city and nearby suburbs.
Within city limits, 99.7 per cent of the 75,295 detached properties in Vancouver had assessed values of at least $1-million last summer, according to a new study by Landcor Data Corp., which tracks real estate in British Columbia.
In suburbs such as West Vancouver, North Vancouver, Burnaby, White Rock and Richmond, more than 95 per cent of the detached houses in each of those communities also belong to the $1-million club.
In coveted West Vancouver, Landcor made a rare find – spotting the lone detached house assessed last July under $1-million in that community. The property at 6507 Nelson Ave. had an assessed value of $826,700 in mid-2016, making it the only assessment below $1-million among 11,364 West Vancouver detached properties.
The modest place on Nelson Avenue, built in 1937, last sold in 1991 for $156,000. Located on a one-way street near the Horseshoe Bay ferry terminal, the two-storey residence looks like a wooden tree house from a distance, situated on a lot that is much smaller than neighbouring properties. The structure itself is assessed at a mere $9,700, so the bulk of the assessed value is in the land – for developers, it means the house is a tear-down.
Landcor has distilled the data and found only 198 detached homes in Vancouver last July assessed under $1-million, compared with 6,479 that were below the threshold in mid-2015.
In valuations from July, 2015, Vancouver had 91.4 per cent of its detached houses assessed at $1-million or higher.
Condominiums are less-expensive options, with 16.6 per cent of 86,260 condo units in Vancouver assessed for at least $1-million last July, compared with 59.9 per cent of 14,029 townhouses in the city, according to Landcor's study.
Landcor's fresh analysis is based on data released last month by BC Assessment.
For the most part, assessed values last July are higher than current market prices because the real estate market has cooled off since then. Still, Vancouver remains expensive.
When someone spots detached residences for sale under $1-million in Vancouver or several of the pricey suburbs, the listings get shared on social media. Even with recent price markdowns, listings that appear to be bargains don't look so amazing on closer examination – teardowns, busy streets, tiny lots and/or building restrictions.
Sales activity in the region began dropping last April and real estate prices have fallen since last summer. Transactions slumped further after the B.C. Liberal government implemented a 15-per-cent tax on foreign home buyers in August in Metro Vancouver – designed to help curb the housing affordability crisis.
Still, Metro Vancouver is attractive to domestic and foreign buyers, said Rudy Nielsen, Landcor's founder and president.
A variety of factors such as robust demand, limited housing supply and the low loonie fuelled the real estate boom, he said.
"The market is not local. There is definitely foreign investment, but people forget about Alberta. Alberta is a big influence on British Columbia," Mr. Nielsen said in an interview. "Many Albertans have a real love for the ocean and Okanagan Lake."
He said the trend remains intact for the Vancouver region to be a magnet for real estate buyers, who will be on the lookout for housing-related campaign promises leading up to the May 9 B.C. election.
"It will depend on whether the BC Liberals come up with other things," said Mr. Nielsen, who founded Landcor in 1988. He handed over his duties as chief executive officer to Jeff Tisdale in late 2016.
Landcor said member municipalities in Metro Vancouver with at least 80 per cent of detached homes assessed at or above $1-million last July include: District of West Vancouver (just one house shy of 100 per cent), Vancouver (99.7 per cent), District of North Vancouver (99.4 per cent), City of North Vancouver (99.2 per cent), Burnaby (98.9 per cent), White Rock (95.7 per cent), Richmond (95.5 per cent), Port Moody (88.3 per cent) and Coquitlam (80 per cent).
The suburbs showed sharp gains compared with mid-2015, when 23.4 per cent of the detached houses in Coquitlam had assessments of at least $1-million while the figure was 33 per cent in Port Moody and 40.4 per cent in White Rock.
The transformation has occurred over the past 11 years. In 2005, only 11 per cent of detached homes in Vancouver qualified for the $1-million club, according to Andy Yan, director of Simon Fraser University's city program. But the so-called $1-million dividing line between Vancouver's west side and the less-expensive east side gradually shifted eastward over the years and vanished in mid-2016.
Landcor's analysis shows 29.4 per cent of detached properties in British Columbia had assessments at or above $1-million last July, 5.7 per cent of condos and 9.6 per cent of townhouses.
As a whole, 21.5 per cent of all B.C. residential properties saw assessed values of at least $1-million in mid-2016.