VRBA’s Crystal Ball Housing Forecast was presented recently by:

The good news is BC’s economy is strong and Victoria’s unemployment rate is low.

A strong economy and growing population create rising demand. High prices are mostly the result of historically low supply, despite Victoria’s high housing starts of 3,862 units.

There were 1,384 active listings on the MLS at the end of Dec 2017, the lowest inventory for the month since tracked in 1996. Historically, listings have averaged 2,757.

The benchmark value for a single family home in the Victoria Core in Dec was $823,800.

Victoria’s population growth is mostly from other provinces, followed by communities from within BC. A small portion is from immigration. Foreign buyers represent only about 4% of housing sales.

Another interesting statistic – in 2000, single family homes represented 75% of Toronto’s new housing. By 2017, multi-family was 82% of housing due to increasing regulations and costs on development including limited land supply.

Strong demand in Victoria should continue in 2018 with a cautionary nod to “headwinds” including new mortgage rules, rising interest rates, U.S tariffs on lumber and low housing supply.

In addition, BC’s Step Code will add significant costs further eroding supply.

Improving land availability and removing burdensome regulations will be critical to addressing Victoria’s housing affordability challenges and avoiding a path similar to Toronto.

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View this column in Wednesday’s T-C newspaper.