Housing starts are up across Vancouver Island, but a closer look reveals significant variations among municipalities, according to new figures from the Canadian Mortgage and Housing Corporation (CHMC).
Housing starts in Greater Victoria continue to trend up, rising 21.2 per cent year-to-date in 2019, despite a drop of more than 45 per cent in Saanich, Vancouver Island’s largest municipality.
These large fluctuations point to one of the emerging characteristics of the housing market on Vancouver Island, said Braden Batch, a CHMC senior analyst.
Developers are shifting away from single-family homes towards condominium or rental apartments, he said. Accordingly, housing starts can experience sudden spikes, he said.
“You are seeing a demand for more affordable housing and this supply responds to it,” he said.
Of interest is the variation within Greater Victoria, where housing starts have varied widely. Housing starts in the City of Victoria saw a huge increase year-to-date, jumping to 347 starts from 13, with most of the increase in the category of apartments (331). Nearby Esquimalt also recorded a steep increase with new housing starts jumping from four to 78.
Compare this to Saanich, where housing starts dropped by 45.2 per cent, with the largest drop in the category of apartments. Overall, Vancouver’s Island’s largest community recorded 120 housing starts, down 219 from the previous period of comparison.
Oak Bay also recorded a drop of almost 47 per cent in new starts year-to-date.
Looking to the outer communities, Langford recorded an increase of 43.4 per cent, with the biggest increase in apartments. Of the 482 new housing starts, 395 were apartments.
Batch said he could not offer a clean reason for the big differences between Saanich and Langford. The availability of building space and general planning processes are among the factors that might account for the differences, he said.
The West Shore communities of Metchosin, View Royal and Highlands also recorded significant drops in terms of percentages, but the low number of actual new starts in those communities render those figures nearly meaningless. For example, Highlands has yet to record a housing start, after recording all of two during the previous period.
Figures from the Saanich Peninsula show that Sidney (down 35.7 per cent) and North Saanich (down 82.9 per cent) recorded drops in housing starts, while Central Saanich recorded an increase (80 per cent). Again, actual housing starts in those communities are generally small, leading to significant fluctuations, at least in terms of percentages.
This said, the figure painted is relatively clear. Communities with a rising number of housing starts are building apartments, eschewing single family homes. Of the 1,196 housing starts in Greater Victoria, 887 fell into the category of apartments.
Just as Victoria experienced a spillover effect from Vancouver’s real estate market, Nanaimo and other communities outsidethe Capital Region are experiencing a spillover effect from Greater Victoria, said Batch, with the proviso that Nanaimo is alsoexperiencing a spillover effect by virtue of having a direct ferry connection to the Lower Mainland.