I just read an article in Vancouver Magazine about how BC Liberals have “picked their side – against affordability.” Writer Max Fawcett talks about Liberal MLA Laurie Throness’ recent justification for his party’s obvious stance on the housing crisis (after presenting a budget last week that did as close to nothing about the affordability problem without actually doing nothing) when he said that people who can’t afford to live in Vancouver should just live elsewhere. He also said that companies and the jobs they offer would end up following them. I, like Fawcett, am scratching my head at this. So, who’s going to start this trend? Who’s going to quit their job downtown, buy in Abbotsford, and wait for the exodus of companies from the city to the suburbs? Throness says he, too, couldn’t afford to live in Vancouver so he sucked it up and bought in Abbotsford without complaining. Well, good, Laurie, but you’re the MLA for Chilliwack-Hope, so wouldn’t it make sense for you to live there? Also, most people don’t pick the company they work for, the company picks them. That is, there are not so many oodles of jobs out there that one can afford to be picky and only take work that is within a certain radius of one’s home. How utterly absurd it would be for me or my husband to turn our noses up at a job because it’s not within a short commute. My husband has a one-hour commute to his job downtown. We bought a 35-year-old townhouse that far out because that’s what we could afford. However, buying in Abbotsford would at least double that commute. And that’s if he were lucky enough to be able to take transit, which, of course, from Abbotsford would be ridiculous.
We bought our modest place eight years ago, and units like ours did not go up in value the way detached homes in the rest of the market went. Fine. We were diligent to pay our mortgage and that’s a forced savings, so we have that equity. I don’t begrudge not having increased our equity by 100% because in any other market that would be an unreasonable expectation. And so should it be for any homeowner. Those who have made huge gains in their home equity have simply won the real estate lottery. They did not, as Christy Clark says, “painstakingly” build the equity in their homes. She says that her government is not going to do anything that may compromise the equity homeowners enjoy. I have earned good money for years and “painstakingly” saved, been frugal, been actively and successfully involved in the stock market, been financially diligent…and yet my investment equity is down 30% since last year because of world markets. Who’s going to prop up my RSP so that I don’t lose MY equity? The housing market went up by 20% in Metro Vancouver in the LAST SIX MONTHS. So, even if the government took modest measures and the market corrected by as much, the vast majority of homeowners would not lose any equity that they didn’t receive in an artificial market in an absurdly short period of time. Artificial, because true supply and demand means that average incomes in Metro Vancouver would be adequate to buy an average home. However, residents here have a median income of only around $70K. So, anyone who was lucky enough to have bought at least 15 years ago got a home for fair market value and has seen their equity grow since then at a rate that could not reasonably be expected with any other investment. If the market corrected so that their equity rose only 30% in the last decade instead of 100%, they would still enjoy a solid increase. The problem is that homeowners have stars in their eyes seeing how much their properties are now worth, so anything less than that will somehow feel like “losing”. They are not losing. They just wouldn’t get the great windfall. And it would only be a windfall if they were to sell and move to Sparwood. YOUR BUYING POWER IS NO GREATER JUST BECAUSE YOUR PROPERTY WENT UP IN VALUE. Because who cares if you have ten million dollars’ equity in your home if every other home costs as much? Further, a home is a long-term investment. Anyone who “loses” equity today will be fine a decade (or typically longer) from now when they decide to sell. I don’t take much notice to my investment portfolio that’s down 30% because it’s supposed to be a decades-long investment. Also, it’s the risk you take buying ANY investment.
In addition to moving far out of the city, the government feels that people should just stop whining because it’s not everyone’s God-given right to own a detached house in Vancouver. Well, I guess it’s not my God-given right to own a detached house in North Vancouver, Burnaby, Coquitlam, Delta, most parts of Surrey, Langley, and much of Abbotsford. I guess it’s only rich people’s God-given right to take that opportunity away from those who for decades were able to buy average homes in most of these areas. I suppose that despite this fraudulent game the rich are playing we should all just be happy to work like assholes our whole lives to put every nickel into an already over-priced condo. That, instead of paying fair market value and having a reasonable commute, enjoying the occasional Starbucks, having room for kids, and saving for retirement.
This government, and idiots like Throness, are deliberately distracting from the actual problem of affordability and fraud. They claim they cannot take any measures that would cool the market down. Yes, of course they can. But they don’t, because when homeowners lose their false equity and get all angry about it because they thought they were rich and now they’re just average they will call for each Liberal’s head. And the federal government does nothing because they know with years of low interest rates, people have racked up personal debt to record levels and would be screwed if interest rates went up. So, government created a terrible situation and now feels forced to keep the party going and leave that disaster for a future date instead of dealing with the disaster now. I cannot believe that even equity-rich homeowners don’t see this for what it is. They SHOULD want the government to intervene. Why? Because this whole situation is based on greed, fraud, and blatantly favouring the rich, and even their children will not be able to buy a decent home here. How do you not see that?