In a recent article in BC Home Magazine, a local economist noted that population growth will likely drive the Vancouver real estate market. In the article he noted that in the final quarter of 2008, BC’s population grew by 14,440 persons. This is second only to Alberta in growth and the largest quarterly growth since 1996. Both international in-migration and inter provincial in-migration are up with the international side growing strongly and interprovincial getting weaker. The connection to house prices seems obvious, as more people move in than move out, demand for housing will increase.
What about other factors that drive the market? Surely interest rates have a major impact. In fact housing affordability has grown in the past 12 months. The article suggests that house prices are down 11% from a year ago and that the actual cost of carrying the mortgage on that average home is down 23%. With numbers like this it’s a wonder that more renters are not trying to get into the market.
