Trickle-down effect: How Metro Vancouver’s real estate slowdown is impacting the broader economy
This is Part 5 in a five-part series on the state of real estate in Metro Vancouver. You can find the first three parts of the series here.
At the height of the Metro Vancouver’s housing market frenzy two years ago, Meredith Chapman of Jim’s Moving barely had time to catch his breath.
“It was insane,” Chapman said. “We didn’t have a day off. I think we worked 364 days that year.”
Real Estate Reality Check Part 1: Taking the temperature of Metro Vancouver’s real estate market
Now business is slowing as the real estate market cools, and some businesses that profited at the height of the market are taking a hit to their bottom lines.
“There’s a knock-on effect, every time you build a new house you’re employing a contractor, a plumber, an electrician, then somebody moves in, they buy brand new furniture,” realtor Steve Saretsky said.
For established companies like Jim’s Moving, that economic trickle-down effect is tangible but manageable, but it could be potentially devastating for others.
Real Estate Reality Check Part 2: Factors cooling Metro Vancouver’s real estate market
“I’ve noticed that a lot of my colleagues are really hurting for work these days,” Chapman said. “It just seems that the slowdown is really starting to hurt their bottom line.”
On the flip side, the Wise brothers and their family-run contracting company are seeing an increase in business as clients who might have sold, profited and upgraded in years past are opting to renovate.
WATCH: First-time buyers looking to capitalize on cooling Metro Vancouver real estate market
“More people are starting to lean towards renovations, I’d say, because of the slight downturn in the market with sales,” Sage Construction’s Nicholas Wise said.
According to brother Daniel Wise, “The stipulations and taxes that they’ve put in since the last two years now have certainly slowed down the market and now it’s kind of becoming normal again.”
The province says the capital infrastructure projects, and the jobs associated with them, are still there.
“If you just look at the Lower Mainland alone, the Pattullo Bridge is going to be a huge project where we’re going to need construction workers,” Finance Minister Carole James said. “Right now we have companies telling us they can’t find enough workers.”
Real estate reality check Part 4: Home equity loans leave some B.C. homeowners at risk
Coquitlam city Coun. Dennis Marsden said there is still cause for concern.
“The projects that we already have in the pipeline are proceeding, but some of the ones I’ve talked to at this point in time have said they’re going to put the brakes on from there,” he said.
For the Wise brothers and others who rely on building shelter for their livelihood, the uncertainty is impacting their own dreams of home ownership.
“For the last 10 years, I was always planning to buy a house and it ended up being a townhouse,” Daniel Wise said.
“But, eventually, we’re going to have to upgrade to a house which is now a million dollars even in New Westminster, and that’s a fixer-upper.”
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