Average Metro Vancouver rent projected to increase 16% in 2 years

[misher]

https://www.vancourier.com/real-esta...oil-1.23518374

Consequences of implementing rent controls and new taxes is that people are withdrawing from the rental market with total rental supply shrinking in 2018 and developers cancelling or converting rental projects.

CMHC’s forecast may be optimistic if B.C.’s current leadership proceeds with its plans.

The simplistic logic from many of B.C.’s politicians is that they can force builders and investors to build or buy apartments that they have no chance of making money on.

The province, for example, has struck down a planned 4.5 per cent annual rental increase allowed under its Residential Tenancy Act and will cap the allowable increase at 2.5 per cent in 2019. Yet landlord property taxes, utility rates and insurance costs have been increasing exponentially. BC Hydro rates, as one example, have risen 7.5 per cent since 2016 and will increase 3 per cent next year.

That clattering sound you hear is the downing of hammers at planned new rental projects.

The B.C. government has also brought in a speculation tax and onerous and intrusive regulations on pre-sale condos that will drive away investors – and builders who need pre-sales to secure construction financing. The new rules will further drive down new condo sales, which have already fallen 14 per cent since January, leaving an inventory of nearly 4,500 newly completed and unsold condos clogging the Metro market.

As a result, CMHC forecasts that Metro strata starts will fall 27 per cent over the next two years, reducing the single biggest source of rental apartments and further dashing the slim hopes of rental tenants.

Unfortunately every policy has its repercussions. That's 16% on average so given that current renters cannot have their rent increase more than inflation it will be new renters that feel the burn. Vancouver's about to get a hell load less affordable. On the bright side, housing is cheaper to purchase, thats what matters [sarcasm].

[djmk]

First rule of spotting fake news: always be suspect of dubious math

Second rule of spotting fake news: go to the actual source.

CHMS fall 2018 report shows vacancy report going up with modest increase in rents

[Alex Mackinnon]

Sure thing buddy.

All those 45,000 or so housing starts from last year definitely aren't going to flood the market when they actually get completed in a couple years. The housing cycle is nowhere near as fast as the author seems to think.

When it comes to reading opinion pieces, you need to remember that opinions are like assholes. Everyone has them. Unfortunately a lot of opinions pieces with seriously flawed logic get published in newspapers.

Who cares if housing starts are down compared to last year when last year was a huge anomaly that was clearly way above sustainable levels. There aren't enough trades in Vancouver to build all those units on their schedules.

[rofina]

Originally Posted by Alex Mackinnon

Sure thing buddy.

All those 45,000 or so housing starts from last year definitely aren't going to flood the market when they actually get completed in a couple years. The housing cycle is nowhere near as fast as the author seems to think.

When it comes to reading opinion pieces, you need to remember that opinions are like assholes. Everyone has them. Unfortunately a lot of opinions pieces with seriously flawed logic get published in newspapers.

Who cares if housing starts are down compared to last year when last year was a huge anomaly that was clearly way above sustainable levels. There aren't enough trades in Vancouver to build all those units on their schedules.

There are a lot of completions coming down the line - but I suspect new units will be slow to follow. The huge construction bump should be absorbed because of lack of new product.

Add to this the growing economy (sans real estate) and its not all doom and gloom.

That being said, this doesn't mean that prices aren't going down. They are. I just still don't see the epic 50% wipe out that bears have been clamouring over since 2006.

[fredinno]

Originally Posted by rofina

There are a lot of completions coming down the line - but I suspect new units will be slow to follow. The huge construction bump should be absorbed because of lack of new product.

Add to this the growing economy (sans real estate) and its not all doom and gloom.

That being said, this doesn't mean that prices aren't going down. They are. I just still don't see the epic 50% wipe out that bears have been clamouring over since 2006.

There will be; just wait until the USA finally goes broke.

[misher]

Originally Posted by fredinno

There will be; just wait until the USA finally goes broke.

When that happens I think we're going to have bigger concerns than housing.

[MIPS]

Originally Posted by misher

When that happens I think we're going to have bigger concerns than housing.

I was not aware that people from Merritt were that intimidating.

[rofina]

Originally Posted by fredinno

There will be; just wait until the USA finally goes broke.

Sure - but you're betting on a black swan to get into the housing market.

Maybe you're right tomorrow, in 5 years, or in 50. Its not a realistic way to plan a life for most people.

Odds are much better to say, buy something you afford today, hold for 10 years, you'll do well.

History is more onside with that, than a 50% collapse.

[Alex Mackinnon]

Originally Posted by rofina

Sure - but you're betting on a black swan to get into the housing market.

Maybe you're right tomorrow, in 5 years, or in 50. Its not a realistic way to plan a life for most people.

Odds are much better to say, buy something you afford today, hold for 10 years, you'll do well.

History is more onside with that, than a 50% collapse.

That really depends where you think we are in the cycle. History also shows that housing tends to move with inflation and wages. When the price of something gets too far ahead of either, down she goes.