housing
05. housing
Following 2019’s record high for starts, Metro Vancouver is positioned to see new housing supply dwindle as the economy ramps back up.
NEW CONSTRUCTION STARTING TO SLOW
Following a record-setting year for new housing construction in Metro Vancouver in 2019—when the region tallied more than 28,000 starts—the pace has decidedly cooled in 2020. Specifically, in the 12 months through August 2020, Metro Vancouver registered only 22,401 starts, 16% below the count of starts from the preceding 12 months (26,694). The region is not unusual in that its pace of housing construction has slowed during the pandemic. In fact, while Toronto has seen only a modest increase of 2% in its starts over the past 12 months, Montreal has seen starts activity fall by 14%, while on the west coast BC as a whole is down 13%. Nationally, starts are 1% lower. Part of this has certainly been due to “tools- down” pauses in construction in the early days of the Great Suppression, and then
to less-efficient construction practices in the latter days of the downturn (due to social-distancing constraints), which prevented construction starting on new sites as existing jobs took that much longer to complete. Looking ahead, it is likely that starts activity in Metro Vancouver will continue to face headwinds—not directly because of Covid-19, but rather indirectly because of it. This is because pre-sale project launches slowed considerably through the first six months of 2020, with the 4,429 homes launched in the region representing only 42% of 2019’s full-year total of 10,588— itself the lowest count of pre-sale home launches in almost a decade. This could create a perfect storm for Vancouver’s housing market, with demand returning to pre-pandemic levels at the same time as a dearth of starts is realized.
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