Impact likely marginal, ‘not transformative’
Derrick Penner
Sun
British Columbia’s southwest region can expect the 2010 Winter Olympics to deliver a four-per-cent kick to housing growth, economist David Baxter said Tuesday.
Baxter, speaking to Canada Mortgage and Housing Corp.’s annual housing outlook conference, said the impact will be marginal, “not transformative.” The increase in home construction — above what would have been expected without the Games — could last until 2031.
It will be driven by people moving into the region for jobs created by Olympic-related spending, and then from the “legacy effects” felt from the promotion of Vancouver.
Canada Mortgage and Housing commissioned Baxter’s Urban Futures Institute and CitySpaces Consulting Ltd. to study the potential impact the Olympics could have on demand for housing from 2006 until the event, and beyond.
Baxter said their study estimated that by 2031, B.C.’s southwest, which includes Greater Vancouver and the Sea to Sky corridor, will have drawn 94,000 more people looking for work than it would have if the games weren’t here.
Those workers, along with dependents, will give the overall population a boost of 152,000.
Housing those people, Baxter said, will require 27,000 more houses, 13,600 more townhouses and 20,500 more apartments. In total, the housing growth works out to be about four-per-cent higher than if Vancouver and Whistler weren’t hosting the games.
“Are the games a big deal?” Baxter said. “They make a positive contribution to [the economy], but they’re not transformative.”
He noted that the Vancouver-Whistler region will be the largest area with the biggest economy to ever host the Winter Olympics, so “we’re going to absorb [the games] and move on.”
Baxter added that critics are right in saying that there are a lot of other things that governments could spend money on than the games, but they likely would not have spent as much in absence of the Olympics and likely not all in B.C.
Baxter said the construction stimulated by the games is “the real issue . . . which brings a lot of people who would otherwise go to [Alberta’s] oilpatch.”
Then, more importantly, is the role the games’ play in reinforcing Vancouver as a brand, because “the Olympics is not a destination event, it’s a branding event.”
Canada Mortgage and Housing regional economist Carol Frketich said the agency commissioned the Olympics study as part of its mandate to research events or trends with a potential to affect housing markets.
To do the study, Baxter said the consultants studied the experiences of other host cities along with B.C.’s housing market data. The estimates included the use of an extrapolated, long-term trend for B.C.’s economic growth factoring in an estimate for Olympics-related spending.
Baxter said consultants used an estimate of $4.9 billion in direct, indirect and induced Olympics-related spending to host the games and related activities.
That figure was one scenario forecast by InterVISTAS Consulting in its cost-benefit scenario for the games.
To put that spending estimate into context, Baxter noted that the labour contracts the provincial government signed with civil-service unions will have a direct, $6-billion impact by 2010.
And the province will spend $12 billion on health care and $8 billion on education this year.
OLYMPIC-SIZED HOUSING BOOST
Consultants have estimated the impact that hosting the 2010 Winter Olympics could have on housing markets. Economist David Baxter says, based on a spending estimate of $4.9 billion, the impacts will not be big, but not negligible either. They are:
– 94,000 new workers in the workforce.
– 152,000 boost to population.
– 61,100 additional housing units.
© The Vancouver Sun 2006
