14 Jun Vancouver Housing Prices and Net Migration Correlation?
There is no secret that the main topic of conversation within the real estate and the financial communities is housing prices in Vancouver, Toronto and now it looks like Victoria, British Columbia, and Hamilton, Ontario are also getting in on the act.
The debate is ongoing as to what is causing housing prices to go up, in my opinion, the following are the key drivers, in no specific order.
* Inventory levels.
* Available buildable land.
* Interest rates.
* Employment rates.
* Net migration.
* Immigration policies.
* Foreign ownership restrictions or the lack of it.
* Millennials are entering the market. ( A larger segment than the baby boomers)
I am only going to address two factors that are not entirely unique to the Vancouver market, but definitely have had a historical impact and will have a future impact on prices.
After the world was introduced to Vancouver, post-Expo 86, it has been regarded as a very desirable place to live and work, and hence, Canadians and immigrants alike have made it one of the top choices to live.
Below is a chart of British Columbia population growth from 1986 – 2015, it has mostly been a very steady line upward.
If we now compare the Vancouver housing index from 1990 – 2015 below, we can see a similar path upward.
Does net migration always mean that prices are going to head up? Not necessarily, but when you take this into consideration along with the other factors above there seems to be support for prices to continue their upward march.