Despite the recent volatility in the Vancouver housing market, affordability challenges persist. There are certainly hopes that the record 45,000 units currently under construction in Metro Vancouver should provide some relief in the near future. However, the reality is, the cost of construction and government taxes remain a barrier, perhaps artificially putting a floor under new home prices in the long run- unless the cost of construction which includes labour, materials, and government taxes decline significantly. Possible, but unlikely. A new report from Altus Group suggests Vancouver construction hard costs are the highest in the country. Hard costs include expenses directly related to the physical construction of a building. As you can see in the chart below, condo construction hard costs start at $220/sqft for concrete construction.

Real Estate Investing Canada: Bracing for a Market Reset
Real Estate Investing Canada: Brace yourself The Canadian real estate market is shifting—and for those focused on real estate investing