Michael Ferreira of Urban Analytics spoke about residential construction at the Independent Contractors and Businesses Association 2016 Industry Outlook held on April 28 in Burnaby, B.C.
Ferreira looked at multi-family home market trends in metro Vancouver, and said "we've never quite seen what we're seeing here today," he said.
Values are getting overheated and are "really stratospheric" at this point, he said. What's causing this pricing is supply not keeping up with demand.
"We never expected a 25 per cent increase in sales over the last year," he said.
The residential construction industry is not keeping up with supply, Ferreira added, and the drop in town home supply alone is "reaching crisis levels," he said.
Part of the demand for townhomes is predicated on people giving up on a single family home, and opting for a town home.
What's causing the disparity in supply and demand is municipalities not responding to the demand increase either by increasing efficiencies to approve projects or work with the industry to accelerate projects, Ferreira said.
"It's taking far too long to get projects through the process," he said.
There is no shortage of units in planning, he added, and just on the concrete condo side 63,000 units are planned in the Lower Mainland.
The industry is ready to bring more supply into the market, but "we need competition levels to increase" he said.
There will be no shortage of work in residential construction, Ferriera said, but the bad news is that if supply issues were addressed there would be even more work.