Trading in a higher interest rate environment
Category: 2023 newsletter
The federal government has finally confirmed its intention to remove GST charges on new rental housing, an excellent but critically delayed measure.
On September 11th, 2023, the B.C. government moved for the fifth time in six years to limit the maximum allowable rent increase below the level set out in the government’s own standard.
Metro Vancouver’s multifamily market remains challenging, but it’s showing new life despite persistent inflation, interest rate hikes, and rising expenses for developers and landlords.
In BC, the increase is typically based on the 12-month average percentage change in the All-Items Consumer Price Index for the province, ending the previous July. Prior to 2019, this formula was CPI + 2%. This formula had been in place since 2000.
The main advice to anyone contemplating a move into this form of commercial real estate is the same as in any other major business undertaking: do your homework.
One of the City of Vancouver’s most important rental districts has a vacancy rate of just 0.5% – a negative result of our citywide crisis of housing affordability.