Report foresees pent-up demand in South Island market

Real Estate Investment Network analyst says a perfect storm is brewing for the Saanich housing market

Demand is putting pressure on higher-density developments in the Saanich and Greater Victoria housing market

If you’ve been thinking about moving into another home but have put it off due to the recent housing spike, you may want to re-think that decision and act while you still can.

Prices for the South Island’s already intense housing market, for renters and owners, are set to go up in 12 to 18 months, according to a new report from The Real Estate Investment Network. The third-party real estate analyst agency released the report on Greater Victoria this week, marking it as a sustainable investment market that’s poised to outperform many other non-Metro-Vancouver real estate markets in B.C.

Victoria’s extremely low vacancy rate of 0.6 per cent is forecast to remain low through 2017 and beyond.

It’s the start of a long-term trend that will see demand completely outstrip supply in Greater Victoria, with prices that will continue to rise unless action is taken.

“There are too many factors, all putting a demand on densification [that isn’t here],” said Don Campbell, a senior analyst with REIN. “Put that on top of the already-occurring trend of moving to the South Island, and it’s a perfect storm forming.”

He said Saanich, and Greater Victoria, need to keep talking density, including easier secondary suite approvals, laneway cottages and detached suites, or it’s going to see a potentially out-of-control increase in street rents (prices for available suites).

Vancouver’s much-ballyhooed foreign-buyers tax does in fact shift demand to Greater Victoria. However, it’s only one of many factors causing the upward movement of property demand and values, the REIN study found.

“A few offshore buyers will consider Victoria, and you’ve always had people moving here from the Prairies, that’s not changing,” Campbell said.

The pressure comes from the 27 per cent of Canadians who are baby boomers, heading into retirement, and considering a move to the South Island. At the same time, 27 per cent of the population are 20 to 29-year-old millennials, half of whom still live in their parents’ houses. They’re ready to enter the market.

The University of Victoria also brings in a great deal of renters, as 74 per cent of its 20,000 students come in from out of town. UVic has also done a better job of keeping grads here with a startup industry.

“That’s a big dam of pent-up demand for housing and rentals in the next five years, it’s the highest pent-up demand we’ve ever seen,” Campbell said.

Making Greater Victoria attractive is new jobs and diversification of job sectors, including an increasing technology sector, with 880 tech companies creating 15,000 direct jobs.

REIN also looked at Saanich’s controversial environmental development permit area bylaw. Campbell’s consensus is that, even with restrictions on the development of EDPA properties, they’ll end up increasing in value anyways.

“Anytime you have a restriction on densification, you’ll have an imbalance, and in Saanich in 12 to 18 months there will be a real imbalance,” Campbell said. “That’ll exist until there’s more stock available for people to move to.”

 

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

COVID-19: UVic Engineering to 3-D print 4,000 face-shields for frontline workers

Team working to ensure Island health care workers have personal protective equipment

Mental Health: Erasing stigma leads to new path for Victoria woman

Paula Roumeliotis struggled with bipolar disorder for 35 years before finding support

Health care workers gain access to virtual health care options

During COVID-19 many clinics have closed, leaving health care workers with nowhere to turn

Trudeau rejects mandatory stay-at-home order for now; COVID deaths up

The virus has now infected more than 10,000 Canadians and cost 130 their lives

POLL: Will you be able to make your rent or mortgage payment this month?

With the COVID-19 delivering a devastating blow to the global economy, and… Continue reading

Tax collectors, auditors to help field ‘historic’ numbers of benefit-seeking callers

‘If you work for CRA, people think we are just there to take money from your pockets.’

Family uses social media to help truckers find places to eat during pandemic

Restaurants Serving Drivers in Western Canada seeks to provide a list of places open for drivers

Advocates sound alarm over COVID-19 limiting access to contraceptives, abortion

The COVID-19 outbreak has hit sexual-health services from almost every angle

Cowichan couple won’t self-isolate after returning from overseas

New law requires 14 days of self-isolation when returning to Canada

B.C. health officer says homemade masks may prevent spread of COVID-19 to others

Practising physical distancing, frequent hand washing and resisting touching your face are proven methods

B.C.’s senior home staff measures show results in COVID-19 battle

Dr. Bonnie Henry’s order restricts care aides to one facility

Independent investigation praises RCMP actions in Vancouver Island suicide attempt

Man hurt in incident that took place near Nanoose Bay in September of 2019

Most Read