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EDITORIAL: Will the housing market ever cool down?

M embers of a local Facebook group were shocked to see a sign for a new townhouse development in Squamish has been replaced. According to the sign, the three-bedroom homes now cost $120,000 more than they were a couple weeks ago.
townhouses

Members of a local Facebook group were shocked to see a sign for a new townhouse development in Squamish has been replaced. According to the sign, the three-bedroom homes now cost $120,000 more than they were a couple weeks ago. 

“Unreal!” says one comment. 

While this higher price tag could be due to the cheaper suites already being sold, the outrage shows how fed up many people are with the continually rising cost of owning a home. 

This begs the question – With all the new development in Squamish, will housing prices begin to fall?

Last week, council approved a six-storey residential/commercial building for downtown and approved rezoning that paves the way for a subdivision with 35 single-family houses in Brackendale. The list of new developments goes on and on. 

But all this new inventory isn’t making housing cheaper. In fact, the opposite is happening. 

Take the average townhouse in Squamish for example. The benchmark price in June was $680,400, up 16 per cent from last year and 91 per cent from three years ago, according to the Real Estate Board of Greater Vancouver. An apartment unit comes in at $413,400, a jump of 22 per cent from last year and 92 per cent from three years ago. 

A typical house, of course, costs more at $947,300 – up a whopping 19 per cent from last year and 77 per cent from three years ago. 

But hundreds of new housing units are being built in Squamish, so the price is bound to stabilize – or maybe even go down – right? All this competition will give buyers more choice, driving the cost of owing a home down, right?

Not necessarily. Squamish’s population is predicted to double in the next 15 or 20 years. That’s a lot of new people moving to town, many of whom are leaving other, more expensive, communities in the Lower Mainland in search of (relatively) cheaper housing. They’ll put up with the rising prices in Squamish because it’s more affordable than where they’re coming from. 

In comparison, prices in North Vancouver continue to jump (the typical property has risen 59 per cent in five years), despite the many new developments being built. 

While some homeowners benefit enormously from the hot market, prices are driving others out of town. 

Only time will truly tell whether home prices will climb or fall in Squamish.

 

 

 

 

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