Vancouver market update Robyn adamache Senior market Analyst - Vancouver CMHC Market Analysis BC Region January, 27
BC Housing Market Update Economic Fundamentals New Home Construction Resale Market
Economic fundamentals Main factors driving housing demand low mortgage rates positive Migration Economic Growth employment growth Strong consumer confidence
Mortgage Rates Flat 9. 8. Posted 1- year and 5-year residential mortgage rates, % 8.75% 5-year rate Line 2 1-year rate Line 4 7. 6.5% 6. 5. 4. 2 21 22 23 24 25 26 27F Source: Bank of Canada, CMHC Forecast
migration to Vancouver Strong despite booming Alberta 6 5 4 3 Inter-provincial International 33.7K 2 1-1 1996 1997 1998 1999 2 21 22 23 24 25 Source: BC STATS
BC a Leader of Growth in Canada in 26 Consumer Spending and Investment Underpin Economic Output Fueled by earnings and population growth All types of construction robust 3.5% 5.9% 2.9% 3.1% 2.3% 2.4% Source: Statistics Canada, Q4 CMHC Forecast 2.9%: Canada
Tight labour markets in Greater Vancouver Employment Gains Yr/yr Change (in thousands) 7 Unemployment Rate Percentage 12 6 5 4 Full-Time Part-Time 1 8 3 2 1-1 23 24 25 26-2 -3 6 4 2 1988 1991 1994 1997 2 23 26 Source: Statistics Canada, Labour Force Survey
Consumers Confident 13 12 Consumer confidence, 1991=1 Q1 26: 123.1 11 1 9 1998 82. 8 1996 1997 1998 1999 2 21 22 23 24 25 26 Source: Conference Board of Canada
Housing Starts British Columbia 4, Single Multiple-unit 34.6K 36K 3, 2, 1, 2 21 22 23 24 25 26 27F 28F Source: CMHC
Active resale markets in bc 12, 1, 8, 6, 4, 2, MLS sales, total units 199 1994 1998 22 16K 96.7K 6(e) 7(f) Sources: CREA and CMHC Forecast
New home construction
Housing Starts Vancouver CMA 25 2 Singles Multiples 18.9 15-Year Average 18.7 Thousands 15 1 5 1988 199 1992 1994 1996 1998 2 22 24 26 28F Source: CMHC
New Home inventory Vancouver CMA 7, 6, 5, Singles Multiples 4, 15-Yr Average 3, 2, Complete & Unoccupied Units 1, Dec-91 Dec-94 Dec-97 Dec- Dec-3 Dec- 6 Source: CMHC
Apartment Condo Supply Vancouver CMA Inventory ('s) 3 16 2.5 Vacant Inventory Under Construction 14 12 2 1 1.5 8 1 6 4.5 2 Dec-98 Dec- Dec-2 Dec-4 Dec-6 U/C ('s) Source: CMHC
Housing Starts City of Vancouver* 7, 6, Singles Multiples Avg 5, 4, 4.1K 3.5K 3, 2, 1, 199 1992 1994 1996 1998 2 22 24 26 Source: CMHC, *Includes Vancouver East & West
New Home inventory City of Vancouver* Complete & Unoccupied Units 1,8 1,5 1,2 Singles Multiples Avg 9 6 3 Dec-91 Dec-94 Dec-97 Dec- Dec-3 Dec-6 Source: CMHC, *Includes Vancouver East & West
Apartment Condo Supply City of Vancouver* 12 Vacant Inventory Under Construction 7,5 9 6, Inventory 6 3 4,5 3, 1,5 U/C Dec-98 Dec- Dec-2 Dec-4 Dec-6 Source: CMHC, *Includes Vancouver East & West
Resale market
Greater Vancouver Resale activity Down off record 5 4 Single Detached Townhouse Apartment 41 15-Year Average 36 Thousands 3 2 1 1992 1994 1996 1998 2 22 24 26 Source: Real Estate Board of Greater Vancouver, CMHC Forecast
Cost to Own Widens as Prices Surge 25 2 15 1 Monthly Cost ($) Average Two Bedroom Apartment Rent Apartment Ownership Carrying Cost $38 $1,68 5 1998 1999 2 21 22 23 24 25 26* *26 YTD Carrying Cost, 2 bedroom rent forecast Assumes: 1% down-payment, 25 year amortization, 5-year fixed rates Source: Bank of Canada, CMHC Forecast, REBGV, CMHC Rental Market Survey
Greater Vancouver Resale inventories 15 Active Listings (Thousands) 12 9 6 3 Dec-1 Dec-2 Dec-3 Dec-4 Dec-5 Dec-6 Source: Real Estate Board of Greater Vancouver
Greater Vancouver Sales to Active Listings ratio.6.5.4 Sellers.3.2.1 Balanced Buyers Dec-96 Dec-98 Dec- Dec-2 Dec-4 Dec-6 Source: Real Estate Board of Greater Vancouver
Lower Mainland Average MLS Single Detached Home Prices West Van $1,572, Van West $1,348, Richmond $654, North Van $78, Burnaby $658, Coquitlam $574, +8% +11% +16% Maple Ridge/ Pitt Meadows $461, Surrey Delta $484, $569, Langley $46, Abbotsford $367, Source: REBGV, FVREB
Greater Vancouver Average MLS Price Forecast 25 26 27(F) Single Detached $587,484 12% $729,75 24% $773, 6% Townhouse $362,847 15% $42,47 16% $445, 6% Apartment $296,36 14% $343,55 16% $375, 9% Source: Real Estate Board of Greater Vancouver, CMHC Forecast
Vancouver city* Resale activity 16, Single Detached Townhouse Apartment 13.8K 12, 11.5K 8, 4, 1998 2 22 24 26 Source: REBGV, *Includes Vancouver East & West
Vancouver City* Resale inventories 5, 4, Active Listings 3, 2, 1, Dec-1 Dec-2 Dec-3 Dec-4 Dec-5 Dec-6 Source: REBGV, *Includes Vancouver East & West
Vancouver East Sales to active Listings ratio.8.6.4 Sellers.2 Balanced. Buyers Dec-96 Dec-98 Dec- Dec-2 Dec-4 Dec-6 Source: Real Estate Board of Greater Vancouver
Vancouver East Average MLS Price 25 26 Single Detached $498,79 14% $599,822 2% Townhouse $361,15 27% $438,69 21% Apartment $224,327 22% $264,94 18% Source: Real Estate Board of Greater Vancouver, CMHC Forecast
Average Apt Condo Prices (26) $329K $223K $292K $255K $229K $247K $275K Note: Insufficient data for South Vancouver & Renfrew Heights. $319K $23K $242K $266K $25K $246K $325K Source: Real Estate Board of Greater Vancouver
Vancouver West Sales to active Listings ratio.8.6.4 Sellers.2 Balanced. Buyers Dec-96 Dec-98 Dec- Dec-2 Dec-4 Dec-6 Source: Real Estate Board of Greater Vancouver
Vancouver west Average MLS Price 25 26 Single Detached $1,52,795 18% $1,348,442 28% Townhouse $561,398 3% $661,52 18% Apartment $49,972 16% $468,468 14% Source: Real Estate Board of Greater Vancouver, CMHC Forecast
Average Apt Condo Prices (26) $468K $4K $714K $767K $373K $558K $456K $39K $529K $466K $387K $45K $583K $317K $356K Note: Insufficient data for Arbutus, Mackenzie Heights, & South Granville $515K $316K $23K $325K $497K $396K $274K Source: Real Estate Board of Greater Vancouver
7% 6% Speculative activity % of Condominium Units Held Less Than One Year Housing Bubble City of Vancouver 5% 4% 3% Mini- Bubble Low Speculation 2% 1% % 198 1982 1984 1986 1988 199 1992 1994 1996 1998 2 22 24 26 Source: Landcor and CMHC
Is the market Sustainable? Market Fundamentals Strong, demand stable New Construction levelling off Resale market moderating, price growth to slow
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Contact info Robyn Adamache Senior Market Analyst - Vancouver T: 64-737-4144 E: radamach@cmhc.ca