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Metro Vancouver rents could drop as much as 10 per cent due to COVID-19, research firm suggests

FILE: Downtown Vancouver. (Lasia Kretzel , NEWS 1130 Photo)
Summary

New analysis indicates tenants will be paying less for rent in Metro Vancouver due to a COVID-19-related drop in demand

Expert says a drop in immigration is a big part of the driving force behind dropping rents

Economists say drop in rental demand could also push home prices lower, perhaps by five per cent or more

VANCOUVER (NEWS 1130) – If you’re considering looking for a place to rent around Metro Vancouver, you might be getting a deal relative to recent years.

New analysis indicates tenants will be paying less due to a coronavirus-related drop in demand. The assessment from Capital Economics is that the cost of renting a home in Vancouver could drop in the range of five to 10 percent.

Economist Stephen Brown with the firm says a drop in immigration is a big part of this.

“For Vancouver, in particular, we’re going from a situation where from around 3,000 people were previously arriving every month, looking for homes, and now they’re not arriving at the moment. That doesn’t mean they won’t come eventually, but certainly for the last couple of months population growth has slowed to near zero,” he tells NEWS 1130.

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“Immigration tends to start picking up again from May to September, so that obviously does mean that we could see even worse to come. Those rental numbers could start getting a lot worse, particularly when we consider that for every month in which people are not arriving, the sort of supply of vacant properties is going to keep building.”

Unemployment and the inability for people to see a new property in-person are also contributing factors, Capital Economics points out.

Capital Economics says the drop in rental demand could also push home prices lower, perhaps by five per cent or more.