8 reasons to make real estate investment in Vancouver



Why is Vancouver one of the top destinations in Canada and worldwide for real estate investment? What are the main reasons to buy a real estate in Vancouver? Why do real estate prices increase in Vancouver? What are the main drivers for the demand? Will Vancouver real estate prices continue to increase? Here is a summary to answer these questions: 

1- High return on investment:
- 16% increase in average home prices in 2017 (2% in the first two months of 2018)
- 26% increase in average condo (apartment unit) prices in 2017 (4% in the first two months of 2018)
- 3-4% of annual gross rental yield

2- Low financing cost:
- Up to 30 years of mortgage amortization periods
- 3-3.5% for fixed closed mortgage with a 5 year term

3- Weak Canadian Dollar due to low oil prices
- Oil prices almost halved in the last four years
- CAD depreciated around 20% against USD in the same period

4- Strong and growing economy: 
- Strong regulations ensuring sustainable growth
- Growing economy (3.5% GDP growth for BC)
- Vancouver becoming hub for tech start-ups

5- Top ranked in terms of quality of living:
- 2nd highest Green City Index score (out of 120 cities)
- Cleanest air in the world
- Best climate among largest cities in Canada

6- Growing population:
- 3rd largest city in population
- 41% immigrants
- Over 30,000 immigrants per year
- 136,000 international students in BC

7- Low supply:
- Low inventory for sale (less than 1% of total homes)
- Tight regulations regarding permits and rezoning and long development duration
- Low number of new developments (less than 30,000 units per year)
- Geographical nature of the city having not much room to extend

8- Low inventory for rent:
- Rental restrictions in large number of buildings
- Only 0.9% vacancy rate for rentals

Sources: Statistics Canada, Real Estate Board of Greater Vancouver, Canada Mortgage and Housing Corporation, Economist Intelligence Unit, investing.com, ratehub.ca