Why it was hard to sell or buy a home in Vancouver in 1981
CBC Archives | Posted: August 27, 2019 3:30 PM | Last Updated: August 28, 2023
Interest rates were the stumbling point
Many Vancouver homeowners were in a state of high anxiety as of the late summer of 1981.
That's because their homes reportedly had the highest prices in North America and they came with corresponding high-priced mortgages that were hard to carry.
And that combination of high prices and mortgages with high interest rates made their homes hard to sell.
"So many houses are now for sale in Vancouver that it takes nine volumes to list them all," Russ Patrick reported on The National on Aug. 27, 1981.
Just 300 homes had sold in Vancouver that August. That was down from 2,000 that sold in the same month the year before.
Prices weren't the problem
The trying market conditions were prompting hundreds of homeowners to slash their asking prices.
Karen Hardy and her husband had tried that twice. But they had still been unable to come up with a successful sale.
The couple had come close to selling when a potential buyer put up a $100,000 down payment. But he couldn't get a mortgage for the remainder of the purchase.
"I don't think the price is the problem, I think it's the high interest rates," Hardy told CBC News.
"People just can't qualify for mortgages. I don't think it's the price at all."
'A lot of money'
Richard McAlary of the B.C. Central Credit Union agreed that the combination of high prices and high mortgages was tough for would-be homeowners to handle.
"A $100,000 mortgage at 22 per cent is a lot of money," said McAlary.
The situation had caught the eye of the Wall Street Journal, which had referred to the "collapse" of housing prices in Vancouver in one of its headlines.
Maurice Butler of the Vancouver Real Estate Board thought the use of the word was a bit over the top.
"We're almost getting back to wartime terminology," he told CBC News. "Nothing like that."
Patrick told viewers that "no one in the real-estate business in Vancouver" expected interest rates to come down in the six months to come, which meant prices were likely to continue to fall.
A year later, The National was reporting on the Vancouver-area real estate market again, and prices at that point were falling.