About 80 per cent of new construction is multifamily, says CMHC
Paul Luke
Province
Condos, like this development at the King George SkyTrain station in Surrey, led a jump in multifamily construction in the Lower Mainland. Photograph by : Les Bazso file photo – The Province
The Vancouver area finished 2007 with the third-highest number of housing starts in a half-century and the pace of home building is expected to remain brisk this year.
Fuelled by a strong condo market, the overall number of housing starts hit 20,736 in 2007, up 11 per cent from 2006, Canada Mortgage and Housing Corp. said yesterday
Multifamily homes comprised about 80 per cent of housing starts in the Vancouver area last year, according to CMHC’s preliminary figures for the year.
Single-detached housing starts fell by one-quarter from 2006, CMHC market analyst Richard Sam said.
“With the overall average MLS price of a single-detached house over $800,000 in Greater Vancouver, buyers have shifted their expectations toward more affordable, higher-density-style housing,” Sam said.
“Developers have honed in on this demand and increased the number of new multiple-family projects being built.”
Last year brought mixed results to areas in the eastern part of the Lower Mainland.
Overall starts in the Abbotsford area fell 10 per cent in 2007 despite a 23-per-cent rise in single-detached starts.
In the Chilliwack area, a 50-per-cent surge in multifamily starts drove an 11-per-cent increase in overall starts.
Peter Simpson, CEO of the Greater Vancouver Home Builders Association, said residential construction should remain strong in 2008, thanks to the healthy regional economy and robust job market.
The region will likely notch about 19,000 starts this year — little changed from the average for the past four years, he said.
“We’re optimistic,” Simpson said.
“We’re seeing a lot of confidence in the industry that the market will still be there.”
Rising land and labour costs, as well as growing municipal development charges, may yield a six-to-eight-per-cent price increase this year, he said.
The region’s land constraints mean multifamily projects will continue to dominate in 2008.
“Among this generation of first-time homebuyers, there will be those who live their entire lives in some form of multiple-family housing, whether it’s townhouses or apartment condominiums,” Simpson said.
“Initially, the reason is affordability but over time they may find that condominiums more appropriately match their lifestyle and they don’t want to do anything else.”
Across B.C., overall housing starts in urban areas rose by 5.5 per cent last year, CMHC said.
Urban multifamily starts rose to a 14-year high in 2007, accounting for more than two-thirds of B.C. housing starts, CMHC said.
Nationally, housing starts rose one per cent last year to 229,600, the second-highest level in almost two decades.
© The Vancouver Province 2008
