Vancouver housing affordability might not change

A recent report for the Urban Development Institute released this week suggests that the hosuing affordability issue in Vancouver might not improve this year if the restrictions on certain regions and other factors leading to lack of home supply in the country is not addressed.
According to UDI president Anne McMullin, Canadians should restrain from blaming foreing buyers as the root cause for the high home prices in major real estate markets. In addition, the tax imposed on foreign buyers has no effect on creating more homes in the market or making home prices more reasonable.
The main reason why home supply is becoming a problem is that despite the fact that Canada has vast available lands, however 85% of these lands are under restricted areas, single family discrete areas, which imply no multi-family condos, townhouses, row homes, duplexes or sales of laneway homes are even allowed.
This creates a limit to the supply of homes and also on the construction of new buildings.
Lack of approvals in multi-family buildings, high cost of land and shortage of land for construction are also contributing factors to the current problem at hand.
With all these factors holding back home supply, home prices are definitely expected to keep rising.
McMullin added “we need more homes for more people.”
The Canadian population is on the increase hence this calls for the construction of new homes as an influx of more homes in the market will help bring down home prices.
Of all other home types, townhouses are most affected by the short supply as reports shows that there were only eight homes left in the market of this type of home which by the end of 2012, there were over 320 units. This suggests that the demand for townhouses is very high.