Housing to remain hot through ’08

Friday, May 21st, 2004

Ashley Ford

The Greater Vancouver housing market will “sustain” its current pace through 2008 based on current inventory and upcoming projects, Bob Rennie, of Rennie Marketing Systems, said yesterday.

Speaking to the Urban Development Institute’s annual general meeting, Rennie, the city’s most successful residential realtor, said he has no fears of a “bubble” market and there “is still pent-up demand in the marketplace.”

He said despite the intense building and buying activity, demand will continue to outpace supply in the downtown, Burnaby, Vancouver East and Richmond areas.

While agreeing much of the demand is driven by low interest rates, people still want to buy their own property rather than renting, he said.

He estimates 40 per cent of the downtown market will be driven by investor buying and they will be the suppliers of rental product.

“Major landlords and pensions funds are not going to build rental. There will not be another rental tower built in Vancouver in the next 10 years,” he said.

He said that if “everything on the radar screen” downtown gets built that will add 6,445 condominium units to the downtown supply at an annual rate of 1,432 units until 2008.

With those numbers it is clear this market is sustainable, Rennie said. “Historically, without any job growth, the downtown can support 1,000 to 1,200 units per year so these numbers are clearly sustainable.”

Rennie said it is important to note that even though mortgage rates are edging up, buying power will remain strong.

“Let us not forget that all of today’s buyers, investors and homeowners are sitting on pre-approved mortgages. That’s approved money from 4.95 per cent to 5.5 per cent.”

He said buyers are able to buy today for a 24-to-30-month completion with the banks and financial institutions guaranteeing today’s best rate with a float rate down should the rates dip during the next 24 to 30 months. That is pretty positive, he added.

© The Vancouver Province 2004

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