Editorial — The cost of housing is changing
Housing sales are steady in the Fraser Valley, even as they seem to be in a bit more of a decline in Metro Vancouver.
That’s the story of June real estate sales from the two real estate boards — Fraser Valley, which covers Langley, and Greater Vancouver.
Declines in sales activity and prices are more marked in Greater Vancouver, but as neighbourhoods and Lower Mainland cities are so different, it is hard to paint with too broad a brush.
However, there are a few basic trends which seem to be emerging.
One is that, despite low interest rates, people seem to be unwilling to pay any more for housing. Prices have been going up and up for the past decade, and are now at the point where many working people simply can’t afford to buy. This applies in single-family residential neighbourhoods in Langley just as much as it does on the west side of Vancouver.
Another trend is an inability to qualify for a mortgage. The federal government has tightened up the amortization period for homes requiring Canada Mortgage and Housing mortgage insurance — it is now 25 years. Even with low interest rates, that means bigger monthly payments. When prices are high, and most people aren’t seeing wage increases, that means some people simply can’t get into the market.
A third trend is more intangible, but nonetheless valid. People have a sense that the economy isn’t doing nearly as well as it could, and even positive economic news does not entice them to go out and borrow a great deal of money.
Home construction, renovation, real estate sales and businesses catering to homeowners together account for a huge portion of Langley economic activity.
Any significant downturn in housing construction and sales will have a major effect on many people in Langley — even those who are not in the market for a new house.
It should be the goal of governments at all levels to make home ownership as easy as possible for as many people as possible. People who own their homes have a real and tangible stake in their community, and this in turns fosters a better sense of community and more involvement with others.
If lower prices help more people to eventually buy homes, that’s a good thing.