On January 17, the Urban Development Institute hosted their annual Forecast Luncheon, and the common agreement between developers was that home prices in Vancouver will continue to decrease but will bounce back in 2019.
Prices will bounce back
President and CEO of Polygon Homes, Neil Chrystal, said “This year, the single-family home market will remain slow, and experience further price corrections… In order for prices in the multi-family market to stabilize, we must first find the bottom of the single-family market, and I believe this will happen in 2019. 2019 will be the year of a reset in the multi-family sector. Developers will have to offer new homes at reset prices.” He followed by stating that a price adjustment for the single-family sector has been overdue and is needed for the market to bounce back again.
Founder and CEO of Anthem Properties, Eric Carlson, also agrees with Mr. Christal. He added that “there is no bubble… it is just a slight adjustment. More expensive single-family homes will adjust more, and as you move towards the middle and lower end, prices will also adjust a little, stop, and then reverse.” He believes there will be a bounce back because “once the market adjusts to whatever foreign buyers and [those affected by the speculation tax] leave it because of the taxes, new investor demand will take its place and prices will grow from there.”
Effect of population growth
Both Carlson and Chrystal mentioned that there are still new households forming every year and there is a need for housing. Moreover, rents will continue to raise.
Todd Yuen, president of industrial at Beedie Development Group, mentioned the arrival of new employees for big companies as Amazon and the affect it has on demand for housing. With the arrival of 5,300 employees for Amazon itself, there will be a higher demand for housing.
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