The median list price for a home in Cleveland jumped 15.4 per cent in April to US$101,400. Yes, that is April 2021, not 1981.
In Canadian dollars, the median Cleveland price works out to roughly $125,000. The average price of a house in Vancouver, Victoria, Edmonton, Calgary, Winnipeg, Toronto, Hamilton, Montreal and Halifax ranges from three to nine times more expensive.
Housing affordability is a national problem in Canada, so much so that we’re starting to hear talk of relocating to the United States. Personal finance writer Gordon Stein made the move recently and is pretty pleased with how things worked out.
“I’ll be candid – it’s different,” the former Toronto resident said in an interview from his Cleveland home. “Lots of things are dramatically better, some things aren’t as good. But I have to say it’s peaceful, it’s calm. You can live in a lovely home, without being burdened by house costs.”
Mr. Stein is an ex-tech industry guy who got into the personal finance world by writing a book called Cashflow Cookbook: $2 Million of Financial Freedom in 60 Easy Recipes. Recently, he’s been blogging about living in Cleveland, where he and his wife bought a home about 18 months ago.
Canadians have shown an unprecedented willingness over the past year to move around the country in search of affordable housing. It’s not so easy to move to the U.S., though. Finding an employer to sponsor you is one way, and another is to start a business in a U.S. location. Mr. Stein’s wife is American, which qualifies him to be sponsored for a U.S. green card.
Cleveland may be a Rust Belt city once dubbed the Mistake by the Lake, a reference to its location on Lake Erie. But it’s also an example of something we don’t have a lot of in Canada: mid-size cities that combine an affordable lifestyle with urban amenities. Cleveland has professional baseball, football and basketball teams and the Rock & Roll Hall of Fame.
Mr. Stein and his wife live in a large house on a tree-lined street located 20 minutes by car from the downtown. While the house was purchased at a cost of US$70 a square foot, Mr. Stein thinks it would sell today for about US$100. As in Canada, demand for houses is rising sharply in Cleveland and many other U.S. cities.
Houses in premium Cleveland neighbourhoods might go for US$300 a square foot, Mr. Stein estimated. In the Beaches neighbourhood of Toronto, where he used to live, houses went for about C$1,000 a square foot. He’s been keeping up with Toronto house price trends while living in Cleveland.
“People [in Canada] are so stressed about housing prices – it’s become their life’s obsession,” he said. “I think it need not be.”
Here’s Mr. Stein’s quick rundown on how some other living costs compare:
- Health care: If an employer sponsors your move to a U.S. city, it’s likely that a health care plan will be part of your compensation; lose your job, lose your health care; Mr. Stein said a ballpark estimate for your own health care plan would be US$700 a month, with an annual deductible of several thousand dollars.
- Food: in Mr. Stein’s experience, similar both for groceries and dining out.
- Booze: “I was out with some friends, bought a round of six beers, and got change back from my $20.”
- Gas and telecom: Both are dramatically cheaper in the U.S.
- Income taxes: Mr. Stein said overall income taxes are lower, but not dramatically so in some states; U.S.-based couples may get extra tax savings where income-splitting is available.
- Property tax: cheaper in Cleveland than Toronto.
- Sales tax: 8 per cent in Cleveland, compared with as much as 15 per cent in Canadian provinces.
Housing costs are the most dramatic difference. In Cleveland, the Realtor.com website recently showed 202 three-bedroom or larger homes priced between US$100,000 and US$350,000. Mr. Stein mentioned his son lives in Philadelphia, another affordable housing market.
Meanwhile back in Canada, we have a wave of buyers leaving cities to find cheaper houses in communities across the country. Now, these locations are getting pricey in turn. Next stop, Cleveland?
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