Newton’s 3rd law: Action and Reaction, For every action (force) in nature there is an equal and opposite reaction.

How does this apply to rental housing in BC? 

Housing is not quick and easy to build. It takes time to build a house, longer to build townhouses and even longer to build apartment or condo buildings. The cost of building housing is expensive and continues to increase not only due to government taxes or fees. The building material costs, or building requirements over the years have changed. Many older apartment buildings in BC don’t have sprinkler systems or fire alarm systems in the buildings. All new condos and townhouses have built in fire safety equipment increasing costs to build and repair. 

With recent inflation rates the federal government has increased the interest rates increasing the cost of housing for new purchasers and for homeowners with variable interest rates. An action the BC government took to try and combat the housing issues in BC is to remove strata corporations rights to restrict rentals in their buildings.  The theory for this is to increase the number of rental units in the market place which should reduce the price of rental housing.  The question is does that really work?. 

What we are seeing is with the higher interest rates, and a larger number of new rental products coming to the market these factors are making it less profitable for the landlords. With the profit margin reducing this is causing some landlords to sell their rental product reducing the number of rental properties from the market. This may be what the government wants as well, if a person can purchase instead of renting they may consider this a success. With the current high interest rates many purchasers are not qualified to buy and continue to search for rental properties. The end result is we are losing rental properties from the market at the same time we are adding more, ending up with the same number of rental properties in the market. Each action has an opposite reaction.

Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com