STEVEN TSE PERSONAL REAL ESTATE CORPORATION
  • PROPERTIES
    • FEATURED LISTINGS
    • RECENT SALES
  • SERVICES
    • SELLERS
    • BUYERS
  • NEWS
  • CONNECT
    • MEET STEVEN
    • CONTACT
  • RESOURCES
    • TESTIMONIALS
    • COVID-19

Home prices in Vancouver haven't gone down because people affected by COVID couldn't afford them to start with

6/24/2020

 
Picture
Benchmark price for homes has stayed static; though rents have decreased

JUSTIN MCELROY (CBC NEWS) - COVID-19 has changed elements of living in Metro Vancouver in so many ways, from transportation to the economy to drug and liquor policy. 

But the price of buying a home? Well, some things stay the same. 

"There is a little bit of disconnect right now," said Central 1 deputy chief economist Bryan Yu.

Even with unemployment in B.C. at 13 per cent and a forecast GDP reduction of 7.8 per cent this year, the benchmark price of a property in Greater Vancouver has essentially remained constant — going from $1.02 million in February to $1.03 million in May. 

While there's evidence on sites like Craigslist that the price of rentals has dropped in the last three months, Yu said that the ownership market has stayed static and could even see a slight uptick when official numbers are released next week for June.

He believes one key reason is that people most impacted by the economic downturn weren't players in Vancouver's housing market to begin with. 

  • Metro Vancouver homes sales decline in May, but prices are as high as ever

"Whether it's the accommodation sector or restaurant services ... the economic impact has predominantly hit the lower end of the income spectrum," said Yu.    

"For higher income individuals still in the market, it's likely they were still in the market. They were able to work or stay at home, in some cases able to save money."

Troubles on horizon?
At the same time, Yu said Vancouver's real estate sector couldn't stay impervious to COVID-19 forever. 

"As we move forward into the fall, there's going to be a little more pressure," he said, adding that lower immigration would also have an affect. 

"The economy itself is not strong. It's going to be quite weak as we go forward."

On Monday, the Canada Mortgage and Housing Corporation released a housing outlook, forecasting the lower range for the average home price in Metro Vancouver would fall from $892,790 in 2020 to $809,215 by 2022. 

  • NEW Housing market recovery will be uneven across the country: CMHC report

"Average house prices will decline with weaker household budgets and the uncertain nature of the economic reopening," wrote CHMC senior analyst Braden Batch and senior specialist Eric Bond.
However, they also said Vancouver's "ownership markets are less exposed" to COVID-19, compared to the rental market.
​
"Real estate buyers tend to be older than renters. Therefore, they are less likely to have lost their employment as a result of the economic shutdown," they wrote.

Government response?
The provincial government announced a host of housing policies in 2018 and 2019 — and have put in emergency COVID-19 measures to help protect renters — they have no immediate intention to make further changes.

Finance Minister Carole James says the government will be closely monitoring the situation.
"We're going to watch the housing market," said James.

"With COVID, there have been mixed results … but still a great challenge, so we're continuing on with our measures, and not letting up from making sure we look at affordable housing for people."

As COVID-19 dramatically slowed down public hearings and new staff reports, municipalities saw their housing plans effectively frozen, but that is beginning to change. The City of Vancouver is considering a new policy that would create rental tenure zoning in arterial streets across the city, in exchange for six-storey buildings for stratas, instead of the current four.  

  • 1 year after B.C. introduced rental-only zoning tool, just 1 city has used it (and it's being sued)

A public hearing is expected in July, and Housing Minister Selina Robinson is excited by the development.

"Local governments have been cautious, but we're starting to see more pick up," she said. 
​
"During COVID, things changed in terms of acting on new things, but I'm really pleased to see the activity pick up. It means that local governments recognize we still need to be recognizing housing affordability."

    Market Update

    Updates on Real Estate news happening in your city. 

    Archives

    February 2021
    January 2021
    November 2020
    October 2020
    August 2020
    July 2020
    June 2020
    May 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014

    Categories

    All
    Architecture
    Banking & Mortgage
    City Development
    City Events
    Home Staging
    Market Trends
    Project Presales
    Strata
    Supportive Housing
    Vancouver Heritage

  • PROPERTIES
    • FEATURED LISTINGS
    • RECENT SALES
  • SERVICES
    • SELLERS
    • BUYERS
  • NEWS
  • CONNECT
    • MEET STEVEN
    • CONTACT
  • RESOURCES
    • TESTIMONIALS
    • COVID-19