Advancing the conversation on land and real estate issues in BC.
New rental homes for seniors on the North Shore. Credit: flickr/Province of BC
“Government policies and legislation as a response to changing demographics have the potential to boost or hinder the real estate market,” say John McLachlan and Nicole Wong of Lex Pacifica. “For example, a shift in demographics can mean a change in the preferences of actual or potential buyers, which in turn can change demand for specific types of property.”
Migration patterns is one such key demographic that affects real estate trends, pricing, and demand. “Increased immigration has stimulated international trade and attracted foreign investors [to BC],” explain authors McLachlan and Wong. But migration doesn’t work on its own to drive real estate.
“Most analysts owe the drop in 2019 at least in part to the cumulative effects of government legislation,” say the authors. “In 2018, approximately 5.6% of Vancouver residential properties were owned by non-residents of Canada, with the market dropping further since then. However, not all of the drop can be attributed to foreign buyers, as is made clear when considering travel patterns and the real estate market in Vancouver during the current COVID-19 health crisis.”
The pandemic has drastically curtailed net migration numbers. International students are a clear example. “During a regular year, international students make up a significant number of migrants to Canada, with 645,000 international students alone entering the country last year. These students make up a significant chunk of the real estate market. [In 2020], the number of international students that came to Canada has been cut roughly in half. The lack of immigration and travel has led to rising vacancy rates, lower prices, and luxury homes that usually attract rich foreign investors struggling to be sold.”
|Download Fall 2020|
Read more about demographics and legislative measures in “Demographics and Real Estate in Policy” in the Fall 2020 edition of Input. Download Fall 2020
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