Vancouver real estate investments will benefit from strong housing demand in the near future
Residential real estate in Vancouver has shown remarkable resilience in the current recession. While the market has seen a 5 percent decline in home values compared to the peak reached in 2008, Vancouver home prices have risen, on average, 17 percent each year since 1980. This has made the Vancouver real estate market lucrative and attractive for properties. investors The trend should continue as a number of market indicators, economic fundamentals and other factors suggest that demand for homes in Vancouver and therefore the market outlook for strong investment performance should remain strong.
Several indicators paint an optimistic picture of housing market activity in Vancouver. Home sales in the January-August period are 14 percent higher than the same period last year. However, this compares with an expected decline in home sales of nearly 15 percent nationwide. Indeed, the expected rebound in Canadian home sales next year will be driven primarily by a strong recovery in sales in British Columbia and Alberta, with the Vancouver area leading the way. Increased demand for homes, especially due to limited inventory levels, will put upward pressure on prices, making Vancouver real estate investments highly desirable.
In fact, inventory levels in Vancouver have already dropped as many buyers have taken advantage of low mortgage rates and well-priced properties in desirable locations. New listings are down about 23 percent from last year. According to RE/MAX Canada, the residential real estate market in Vancouver is currently considered balanced, with buyers and sellers on the same page for the first time in years. This has put pressure on prices, which bodes well for those hoping to earn returns on capital on their investment properties.
On the other hand, although the unemployment rate in British Columbia has risen 3.5 percentage points in one year to 7.7 percent in the second quarter of 2009, wages in the region have actually increased 2.2 percent. . At the same time, consumer confidence has rebounded and most Canadians now believe the market is expected to turn so now is the right time to buy. Considering the impending economic recovery, British Columbia, including Vancouver, should see an uptick in employment and wages. With the region expected to lead the rebound in real estate activity in Canada next year, real estate investments in Vancouver should benefit from current and emerging economic trends.
In fact, the Canadian real estate market, and especially Vancouver’s, should be attractive to international real estate investors for a number of reasons. Canada’s economic growth next year will be at least double that expected in the United States and more than four times that of Europe. Additionally, the Canadian banking sector, ranked by the World Economic Forum as the world’s strongest banking system, has created a strong financial environment in Canada that ensures the safety of real estate investments in a highly volatile global investment environment. Additionally, the arrival of the 2010 Olympics and the opportunity to showcase Vancouver globally should bode well for residential real estate in the coming year. Therefore, investing in Vancouver real estate could be a good investment strategy for international investors.
Overall, the outlook for strong Vancouver real estate demand looks optimistic. The expected rebound in real estate activity, coupled with an economic recovery, a strong financial sector and the upcoming 2010 Olympics bodes well for Vancouver real estate investments. Investing in Vancouver property has proven to be lucrative so far and will likely continue to be an option for many local and international investors.