For the past years, the demand for high-end rentals in Vancouver has been continuously rising. Vacancy rates continue to decrease and more rental properties keep on emerging. This boom in demand largely affects the actions taken and to be performed by construction industry players. Large demand requires more supply. Insufficient supply causes changes in prices.
But before addressing it, it is important to figure out the causes of this rising demand. Here are some of the factors affecting the demand for high-end rentals, according to experts and market researches.
What causes the rise in the demand for high-end rentals?
According to experts, here are some of the most common reasons:
As more people from other states and country relocate, the demand for rental houses continue to increase. Since many of these immigrants were forced to relocate due to changes in their assigned work area, they are not looking for permanent properties. They just want a place where they can live while they are in the area.
As generations past, preferences of people also transform. In the case of home ownership, most young people nowadays choose renting over buying their homes. This choice is affected by several factors. First, the nature of jobs of millennial professionals is usually mobile; they get relocated from time to time, from state to state, from country to country. And for single, career-focused young people, buying a home and settling down is just not an option.
- High home ownership rates
As time goes by, people are also becoming wiser and more practical in terms of spending their money. Nowadays, buying a home is a lot more expensive than renting one. Owning a house may cost someone over $3,000, including mortgage, taxes, insurance, and maintenance costs. On the other hand, it is possible to find a decent home to rent in just $1,700. And even in high-end rentals, renting still turns out to be more affordable than buying a luxury property. People still want to experience top-of-the-line kind of living without having to endure the high maintenance and insurance cost.
These are just some of the major factors affecting people’s decision to rent houses, causing the demand for high-end rentals to continuously increase.
As optimistic this situation may seem for the industry, the rise in demands cause one major problem: insufficient demand. Since more people are looking for places to rent but only few properties are available. As the scarcity in supply continues, the prices may also rise, which is something renters may not want.
However, there is one solution construction companies can do: developing high-end properties intended for rentals, also called purpose-built rentals. These are residential properties that are not just mere places to live but also offer high-class amenities for its residents.
One of the organizations at the forefront of developing purpose-built rentals across Vancouver is ENM Construction Management. They have several projects that evidently address this rising demand for high-end rentals. One of these projects is the Willoughby Walk, a 191-unit premiere rental apartment designed for working couples and families.
As the number of purpose-built properties continues to increase, the high demand will be addressed and the market will be a lot healthier for renters and for developers.