The future of Vancouver’s housing market could be on its way to being better and better. A report released by RBC suggests that new Vancouver apartments being built is predicted to make Vancouver more affordable, causing a sharp reversal in the province’s housing affordability crisis.
Earlier this week, Jagmeet Singh, NDP’s Leader, promised British Columbians in his home riding in Burnaby, that he would create affordable housing across the province if elected, along with rental benefits of up to $5,000 each year for those renters and families struggling to pay rent.
Now, this new study by RBC, has predicted an upward trend in Vancouver’s housing market and a significant change in rent across Metro Vancouver over the next few years. That means it could be easier to not only find an apartment but also to afford to live there.
A key component of Vancouver’s housing crisis is because of the city’s rental housing deficit. Rental housing deficit is used to assess housing affordability since most households and families in Vancouver rent homes.
A shortage of available rental units across the province, coupled with sky-high rental rates has catapulted Vancouver into a housing crisis since the past year.
However, The City Of Vancouver’s 10-year housing plan will make a huge positive impact on the region’s housing affordability according to the RBC report. The city has a real shot at making its housing market stable and affordable, if at least 40% of all the newly constructed condos in Vancouver make it to the rental pool.
RBC’s senior economist in charge of the report, Robert Hogue, told Narcity over email that, “a market balance should have a pretty immediate effect on rent”, and lift the city out of its housing crisis if the new condos are constructed as planned.
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According to the report, Vancouver currently has a vacancy rate of below 1%. In order for the city’s housing market to reach equilibrium, the vacancy rate needs to be at 3%, meaning that 3,800 new rental units need to become part of the rental pool.
“There are reasons to be optimistic about Montreal and Vancouver, where strong apartment and condo construction will send a wave of new rental units to the market,” the report stated.
The report also predicts that Vancouver will be able to easily close the rental gap within the next couple of years if new apartment construction activity takes place as planned.
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Vancouver is considered the least family-friendly rental market amongst Canada’s largest cities, and a revival of rental apartment projects in the past three years is predicted to stabilize the market’s rental rates, the report stated.
In addition, keeping aside new apartment projects, the city is also seeing a huge avalanche of apartment listings hitting the housing market for sale, from long time owners and local families.
B.C.’s provincial legislation caps rent increased at 2.5% a year, this coupled with sky-high property taxes means that even long time owners and landlords are selling their properties at unprecedented rates. In fact, the city is expected to see at least two dozen property sale listings within the next few weeks.
The housing crisis in B.C. has been so dire that some people have even resorted to abandoning their pets. Some experts even predict that you need to be 80 years old in order to own a home in Vancouver.