VANCOUVER, British Columbia, Feb. 19, 2021 (GLOBE NEWSWIRE) -- According to BC Check-Up: Invest, an annual report by the Chartered Professional Accountants of British Columbia (CPABC) on investment trends across the province, the number of housing units that began construction in Southwest B.C. fell by 21.7 per cent in 2020 compared to the number started in 2019.
“The COVID-19 pandemic caused great uncertainty for investors across the province, including in Southwest B.C.’s typically robust housing market. Throughout 2020, nearly 6,800 fewer housing units began construction compared to the previous year,” said Lori Mathison, FCPA, FCGA, LLB, president and CEO of CPABC. “With recent residential price increases due to excess demand, this does not bode well for the affordability crisis in the region going forward. However, the situation has improved in recent quarters.”
The largest relative decline was seen in Q2 2020, where the 5,769 housing units that began construction marked a 46.9 per cent decline from the record level set in Q2 2019. By Q4 2020, housing starts had recovered to 6,639 units, up 6.2 per cent from the previous year. However, the situation varied largely by type of unit started.
Attached housing starts, such as condos and townhomes, accounted for the majority of the decline. Prior to the pandemic, attached starts experienced rapid growth. The pandemic reversed that trend in 2020 as the number of attached starts fell by 6,320 units (-24.0 per cent) compared to in 2019. Meanwhile, detached starts declined by 9.5 per cent over the same time period.
“Despite some weakness, developers overall favoured detached starts in 2020,” continued Mathison. “This has also been true for homebuyers, where increased demand for detached units has driven prices up despite the pandemic. How permanent this is, and how housing starts adapt, will be an important trend to monitor in 2021.”
A more positive sign came from the overall level of major projects in Southwest B.C. The inventory of major projects – defined as those with a capital cost over $15,000,000 – increased to $84.5 billion in Q3 2020, up by 14.4 per cent compared to Q3 2019. The gain was driven by new proposals for major projects, which were up nearly one quarter overall and included the new Senakw Housing Project valued at $3.0 billion.
Several projects are anticipated to begin construction in 2021, including the Lougheed Town Center development ($7.0 billion), Broadway Subway Project ($2.8 billion), St. Paul’s Hospital Replacement ($2.1 billion), and Oakridge Centre Redevelopment ($1.5 billion).
“Southwest B.C. continues to attract private capital and will also benefit from government investments. Collectively, the four largest projects slated to begin construction in 2021 will bring over $13 billion of investment to the region, a much-needed injection of capital for our recovering economy,” concluded Mathison. “These projects will bring jobs and economic activity to the region and position it to come out of the pandemic with renewed strength.”
To learn more, see www.bccheckup.com.
About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for over 37,000 CPA members and 5,500 CPA candidates and students. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.