Alex Turner, Market Analyst for the Canadian Housing and Mortgage Corporation visited the NSBSG to outline a summarized version of the 2007 report on the state of the Real Estate Market.

Some key elements in the report included housing demand, resale market, and new home construction.

These elements are all impacted by the economy of not only Canada, but the U.S. as well.

Our export industry is hit hard as new home starts drop in the U.S., and their economy sours while our dollar soars above the U.S. dollar. Those working in the manufacturing sector are laid off and their search for employment brings them out west.

This is reflected in data that shows a net importation of labour to B.C. over the past few years, and although abating, it is still trending upwards. This is contrasted by the movement from the Lower Mainland to the interior by the older population looking for affordable retirement property using their existing equity.

The labour market continues to experience shortages, and B.C leads the nation with 4% unemployment, outpacing the nation at 6%, and a 20-year average of 7%.

Demand for housing is further spurred on by the continuation of low interest rates and more flexible mortgage options.

The CMHC states in their report they are forecasting level interest rates for the next two years.

Analyzing incomes and mortgages, the report shows that monthly-amortized mortgage payments are at the moment outpacing the rise in income. Over time, this will help temper the housing demand; although remaining strong, demand will not be as effusive as before.

Downsizing will continue in the market place, as it will follow the aging population. Less space will be required for living, aided by land shortages, reflecting the political agenda of “eco-density”, a concept still in its infancy.

The report then moved to sales, showing a record increase in 2007. New listings were tight in the market; with only a 5% increase in Vancouver proper, contrasted with 15% rise in Burnaby, 13% rise in the Tri-cities, and a record 18% in North Vancouver.

In terms of new home construction, again, records were broken. The growth can be contributed to the ability of the market to absorb higher prices and demand, led by single family detached housing in the outlying suburbs.

Focused Chat is the weekly 10-15 minutes feature presentation organized by North Shore Business Success Group and presented by NSBSG members and/or their special guests. Check out our Meetings and Events page for details.