Everyone loves British Columbia. Whether it is the beautiful weather, its proximity to mountains and the ocean, or its plethora of activities to do, many people often forget how amazing Vancouver Island is. Often mistaken for the city of Vancouver, we are here to show some serious love for the place that we call home!
So, what are we waiting for? Let’s get started!
Let us Start with the Basics.
Vancouver Island is a large island located on the southwest coast of Canada directly adjacent to Vancouver, British Columbia. Between 2016 and 2021, Vancouver Island added over 65,000 new residents to its previous 800,000, most of these residents landed in the major centres of Nanaimo & Victoria.
Vancouver Island is a unique area as it is geographically capped, you may have heard Mark Twain’s quote “Buy land, they’re not making it anymore”. On Vancouver Island this is a real problem. The many mountains, rivers, and lakes that make Vancouver Island a beautiful place to live have also made a lot of land undevelopable. Major cities like Victoria and Nanaimo are already running out of land, this pushes developers into harder to develop areas which increase costs. What happens when development costs go up and the demand is high? Prices increase.
Basically, what this boils down to is low supply that is geographically capped, and high demand from new residents. This makes it a great, but also difficult, market for investors as competition for deals, materials, and workers is high.
Creative Strategies that you can Count On.
This is where creative strategies are most important to investors as it is difficult to find land that is available and or financially viable to develop. An example of a strategy that can be used in a market like this is our Price Place Land Assembly. In this opportunity we are assembling 5 residential properties with existing single-family homes that are currently zoned Medium Density. This means the city has identified these properties to be used for Medium Density Residential Units (Apartments).
Since Top Down Investments specializes in creatives strategies and unlocking the value in underutilized properties, this market is a great fit for us. We also believe in Vancouver Island as a great long-term market that will prosper long term due to the capped supply, beautiful environment, and location.
Looking at the environment on Vancouver Island, it is home to 587 named mountains, nearly 10,000 lakes, 200 rivers, endless forests, beaches, and a temperate climate. This creates an amazing lifestyle and we’d even go as far to say that it’s one of the most beautiful places in Canada, but we may be a bit biased.
The Pros and Cons of Vancouver Island’s Location.
Vancouver Island, being an island, comes with some pros and cons. One big factor is being geographically capped for land. The limited supply of developable land should keep prices stable or increasing as we look to the future. Proximity to Vancouver presents a multitude of benefits as Vancouver is a truly international city and as one of Canada’s major hubs contains its largest port.
Both these factors cause a continuous influx of new residents from around British Columbia and across Canada. This keeps pressure on the demand for housing, with little to no likelihood of every catching up to the demand. This makes Vancouver Island a lucrative market for developers who can find the right properties that they can creatively make work.
At the end of the day, the fundamentals are playing an important role in the Vancouver Island housing industry. A lot of people are relocating to the British Columbia town, putting pressure on available supply and creating a housing shortage. As a result, prices are spiking as demand continues to outweigh inventory – and this could be the trend for the rest of 2021.
The other crucial factor is that mortgage costs have never been lower. The Bank of Canada (BoC) has kept its benchmark interest rates near zero for about a year, making borrowing cheaper than it has ever been. This is giving homebuyers more options, searching for properties that provide them with a better bang for their buck.