Market and economic uncertainty has proven to be a damper on real estate investor activity in Vancouver, according to data from CBRE.
These factors have compounded the pressure from a lower number of renovictions and strict government policies – the Residential Tenancy Act, in particular. The latter measure has affected investors and apartment owners especially hard.
“It was just easier [for many investors] to do nothing,” CBRE executive vice president Lance Coulson said, as quoted by the Vancouver Sun.
“There were a lot of things going on in the market that created some uncertainty. A number of investors were on the sidelines … wanting to see what 2019 was going to bring.”
From January to June, apartment sales in the Vancouver region amounted to just over $400 million. This represented a pace far lower than last year’s, which enjoyed an overall 2018 total of $1.4 billion.
“Based on a few deals that have sold since June, and what I believe is currently in play, I estimate that total sales for year-end 2019 could be in the $850-million range,” Coulson predicted.
Extremely tight supply in the affordable housing segment remained a feature of the Vancouver market, with rental vacancy hovering around a mere 1% by the end of last year.
The recent edition of IPA’s Midyear Canadian Multifamily Investment Forecast Report also indicated that Vancouver remains the most expensive housing market in the country. The benchmark price for single detached homes currently exceeds $1.4 million, and the median mortgage payment is around $4,000 greater than the market’s average rental rate.
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