From February 2014 to February 2015 home prices in the Vancouver region rose by more than 22%, according to a Canadian Real Estate Association index. But home buyers aren't the only ones feeling the squeeze, according to The Wall Street Journal's Kim Mackrael and Rita Trichur.
The average price for high-density land in the Vancouver region reached 152 Canadian dollars (US$116) a square foot of buildable land in the last quarter of 2015, nearly three times what it was in early 2006, according to data collected by research firm RealNet Canada Inc. Land prices were up about 12% in that quarter alone from the previous quarter, the firm’s data indicates.
Mackrael and Trichur report that developers in the market are optimistic that Vancouver's growing population and international appeal will continue to support rising home prices, which will buffer increasing land costs. But there are concerns.
“The land market is more expensive than it’s ever been and more competitive than it’s ever been,” said Kirk Kuester of Colliers International in Vancouver. “The economics are very challenging for those that are looking to buy.”