CPABC: Housing supply not keeping pace with population growth in Thompson-Okanagan

KELOWNA, British Columbia, June 24, 2022 (GLOBE NEWSWIRE) -- According to BC Check-Up: Live, an annual report by the Chartered Professional Accountants of British Columbia (CPABC) on demographic and affordability trends across the province, the Thompson-Okanagan's population grew to 619,894 residents in 2021, an increase of 9,837 from 2020.

"The pandemic slowed population growth over the past two years, but our region fared better than other parts of the province," said Karen Christiansen, FCPA, FCA, partner at MNP LLP in Kelowna.  "In fact, over the last five years, the Thompson-Okanagan's population grew at the fastest rate in B.C., with new residents drawn here by lifestyle and recreational opportunities and lower housing prices, and more recently, the ability to work remotely."

Notably, interprovincial migration increased significantly in 2021 in the region, with a net 6,791 new residents arriving from other provinces, compared to 3,517 in 2020. This number was the highest in a decade. Of these new residents, the majority were 39 years old or younger.

"Attracting new residents to our region is essential, particularly younger people," noted Christiansen. "Our population continues to grow older, with the average age being 45.4, up from 43.6 in 2011. People 65 and over currently make up nearly one quarter of our population, that's up from one fifth a decade ago. However, housing supply growth has lagged population growth."

Between 2017 to 2021, the number of residents in the Thompson-Okanagan increased by 50,982 while only 20,524 residential housing units were completed. In 2021, a total of 3,697 housing units were completed; about two-thirds were attached units such as apartments and condos. While down from 4,134 units in 2020 and 5,676 in 2019, this is still above the average of about 3,100 annual completes over the last decade.

"Housing completes have declined since the record set in 2019, with attached units down the most," noted Christiansen. "Inadequate housing supply in the region has put pressure on housing and rental prices, posing a serious challenge to both current and potential residents."

In the last year, the average price of a home sold in the Okanagan increased by nearly 10 per cent, selling for $785,660 in May 2022, compared to $716,659 in May 2021. Rental prices also increased, most significantly for larger units. In Kelowna, a three-plus bedroom unit rented on average for $1,709 in 2021, up 7.1 per cent from 2020, while the price for a one-bedroom unit increased by 4.0 per cent to $1,191. The vacancy rate for all unit types was below 1.0 per cent.

"There's strong demand from people looking to buy as well as rent, but there is a lack of supply on both fronts," concluded Christiansen. "Our region needs to continue attracting residents, particularly those of working age who generate the goods and services that underpin our local economy. Looking ahead, it will be critical to generate greater housing development to improve accessibility and affordability."

To learn more, see www.bccheckup.com.
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About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for over 38,000 CPA members and 6,000 CPA candidates and students. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.