October 12, 2011

Metro Vancouver sees an increase in construction

Metro Vancouver’s new housing starts are on the upswing, rising to 1,783 in September over 1,644 in the same month last year, with most activity in the multi-family category, according to Canada Mortgage and Housing Corp.

The reason for the multi-family strength, according to CMHC’s senior market analyst for Metro Vancouver, Robyn Adamache, is two-fold: builders are increasingly confident taking on larger multi-family projects, and buyers are skeptical of higher-priced detached homes because they want to avoid the HST threshold of $525,000.

“On the single-family side, we’re seeing a decline this year,” Adamache said in an interview after the report was released Tuesday.

“When the economic recovery was fragile, builders were more comfortable doing single-family starts rather than a large project. It was a more incremental way of getting out of the recession. Since the recovery has taken a better foothold, we’re seeing the multi-family side pick up again.”

Adamache – who noted that apartment starts were concentrated in the cities of Vancouver and Richmond, while Surrey led the way in less dense housing types including single-detached and townhouse starts – said multi-unit construction has been trending higher since 2010 after declining sharply from 2008 to 2009.

Source: Brian Morton, Vancouver Sun