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Thrive in Cooling Housing Market
B.C.'s development industry must be nimble, disciplined and well-financed to survive the cooling of the provincial market, a veteran developer says.
The Lower Mainland has yet to experience the full impact of the U.S. housing slowdown and the troubles sweeping interior B.C.'s forest sector, Concert Properties president David Podmore said yesterday in Vancouver.
"I do think you're going to see a continued slowing of our economy as . . . what's happening in the Interior and the U.S. spills over," Podmore told a conference on the future of B.C.'s housing industry. "You're going to have to really sharpen your skills to be successful and to compete effectively."
Podmore said developers should stop relying on pre-sales, which he called a phenomenon of the past eight to 10 years. The market is heading into a period where projects may take half-a-year to sell out, he said. Disciplined developers will pull the plug on projects if it becomes clear they can't succeed, he said. There will be opportunities for well-financed developers to take over idled projects -- but they must be fast on their feet, he said.
On the bright side, building materials prices should moderate, thanks to the housing slowdown in the U.S., he said. That's one reason B.C. Pavilion Corp. deferred replacing the roof at B.C. Place, said Podmore, who also is chairman of that organization.
The construction sector will continue to see a lot of work post-2010 but that demand will extend the industry's current skills hunger, Podmore said. Human Capital Strategies president Kerry Jothen said housing starts are projected to grow by 30 per cent to 49,400 in 2026 from 37,600 in 2008.
Construction-related trades and occupations will have about 29,900 new job openings between 2006 and 2026, with about the same number of replacement openings, Jothen said.
"The war for talent is here now. It is international," Jothen said. "This will not change in the near future."