Over the weekend, homeowners learned how their property value had changed in the last year with the release of the latest assessment data.
B.C. Assessment updated its website to reflect values calculated in July of last year, and many noted significant increases in value.
Among those who saw a spike were the owners of B.C.’s most expensive properties. Check out a list of the top 10.
And the increases weren’t necessarily good news. Increases in value have been “devastating” for younger clients and first-time buyers, especially those looking at detached homes, which increased around 20 per cent or more from the previous year.
CTV Morning Live spoke to Thomas Davidoff, director of urban economics and real estate at the University of British Columbia, about what trends he noticed.
The questions have been edited for brevity or clarity. Watch the full interview above.
Are price hikes we’re seeing in Vancouver different from those farther out of the city?
“Yes, absolutely. During COVID-19 we don’t have to commute and, as we’re all sort of familiar with, with work from home we want to have a bit of space.
“So demand has risen for real estate everywhere with the low interest rates, but we’ve really seen demand for real estate rise for single-family homes, suburban areas and even more so for the Interior B.C.”
Some condo assessments went down, while detached home assessments soared upwards. What trends were noted based on property type?
“When you see these assessments, they’re for July 2021. I think we’ve seen condos hatch up a bit since then.
“I think people were maybe more panicked about catching stuff in the elevator pre-mask, understanding pre-vaccine. I think condos caught up. (But) we’re going to see much higher appreciation, I think, in single-family homes than in condos.”
Do you think desire for larger living spaces will change after the pandemic?
“The real key question is are we going to continue to see working from home?
“I think for many of us, we feel the trade-off. When I teach, I know my lectures are better in person than over Zoom. I taught the same class, one in person and one on Zoom; I think in-person was better.
“On the other hand, I don’t like commuting and I love the ability to stay home and be comfortable with that … I think businesses will have a trade-off, so I think we’ll see more working from home, and that will lead to maybe a more permanent reduction in commuting. But how big that would be, that’s a really open question, and as you say, it’s really going to impact housing markets going forward, and even urban planning.”
About urban planning, there’s been a focus on density, condos and building around transit hubs. Will that shift?
“I think it’s going to be up to developers. Looking at the interest rate, the environment we’re in, and the fact that we’ve got so much immigration coming in, I don’t think there’s any question.
“But we’re going to have to move to multi-family housing if we want homes to be affordable around B.C.
“I think letting developers build density, near the SkyTrain, anywhere easily commutable to the core cities is a great idea. Maybe extend multi-family out into the suburbs. But maybe developers will say, ‘Maybe 600-square-foot apartments isn’t the right choice. Maybe we need larger two-bedroom apartments, because that’s what the market wants in an increased work-from-home world.'”
For those who’ve seen a big spike in property value, is it good news or concerning for them?
“It’s great news, especially if you don’t have kids you care about who you want to live in Vancouver.
“I think a lot of families struggle with, ‘What am I going to do with my kids? Are they going to be able to make a life here?’ It’s a real challenge to get into the market.
“But generally speaking, having another few hundred thousand dollars if you’re in a detached house is really terrific news.”
For a first-time homebuyer, is it too late to get into the market?
“You’re going to have to accumulate a larger down payment. Fundamentally, the low interest rate we’re in makes housing affordable, but saving for that down payment and getting the income to do the amortization necessary, that’s (driving a lot of people) out into further areas, out into the suburbs.”