Bob Moore

Real estate is better with Bob

call: 604-506-8965


call: 604-506-8965


2018 Spring Market Update

Forces keeping home prices in check:


  • Existing High Prices
  • Rising Interest Rates
  • A mortgage lending Stress Test designed to ensure new mortgagees can afford rising interest rates
  • The Vancouver Empty Homes Tax
  • The BC Provincial Government stating that they want to see prices not just soften, but fall!
  • A speculation tax in the recent BC Provincial Government aimed at curbing real estate price growth by taxing homes not fully occupied or rented out
  • The new school tax on properties valued over $3 million, really just a wealth tax. Unpopular with the pensioners for starters
  • Increasing capital controls by China limiting money coming out of mainland China; hindering foreign buyers
  • The 20% foreign buyers tax applicable to Greater Vancouver, Fraser Valley, Okanagan, Nanaimo and Victoria area, also hindering buying


Forces driving the market forward starting with the 3 most important:


  • Increased immigration, up from 250,000 per year to 330,000. The Gov’t of Canada plans to welcome 980,000 immigrants between 2018 to 2020 and Greater Vancouver tends to get a disproportionate share of the wealthier immigrants
  • Demographics which show that the Millennial generation has now surpassed the baby boomers in total numbers and they are now entering their prime household formation years
  • An interest rate environment that remains moderate to low
  • Our low Canadian dollar
  • Rising construction costs and competition for labour amidst the on going building boom ensures all new built homes will remain expensive
  • BC having the strongest economy in Canada with low unemployment
  • BC’s vibrant hi-tech sector and film industry lures many well paid young professionals to the province
  • Growing political uncertainty in China, which has been the major source of the foreign capital invested in BC real estate to date, a surge will happen


Government Policy

Federal policies may well eventually overwhelm anything done at the Provincial or Municipal levels. While the strongest forces against the market are driven by government policy, so are most of the forces that are driving the market forward. Of course, the most powerful force is generated by supply / demand economic fundamentals.



Doing something about affordability is not unique to BC. A similar discussion is going on in many coastline cities around the world. 


Municipalities are struggling to keep up. In Vancouver, even though the zoning allows for the conversion of many detached houses into ½ duplexes or even 3 unit conversions with an infill coach house or laneway house, the permit approval process for these conversions is sufficiently slow that it’s impacting the supply of these highly in demand and much needed properties.


2018 Spring Market Conditions

This spring, condo and townhouse prices have risen on strong demand and low supply. This trend appears poised to continue although sales volumes are moderating and so are price increases. Detached house values on Vancouver’s west side are down by about 15%. North Van and East Van are slightly down. 


CIBC issued a report saying that the transfer of wealth from one generation to the next in Canada over the next 10 to 15 years is estimated to be $750 billion. Well, that’s a lot of shekels going to about 5 or 6 million people, which won’t hurt demand!


No comments

Post Your Comment:

The data relating to real estate on this website comes in part from the MLS® Reciprocity program of either the Real Estate Board of Greater Vancouver (REBGV), the Fraser Valley Real Estate Board (FVREB) or the Chilliwack and District Real Estate Board (CADREB). Real estate listings held by participating real estate firms are marked with the MLS® logo and detailed information about the listing includes the name of the listing agent. This representation is based in whole or part on data generated by either the REBGV, the FVREB or the CADREB which assumes no responsibility for its accuracy. The materials contained on this page may not be reproduced without the express written consent of either the REBGV, the FVREB or the CADREB.