New home construction leading economic recovery in Thompson-Okanagan: report | iNFOnews | Thompson-Okanagan's News Source

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New home construction leading economic recovery in Thompson-Okanagan: report

Major projects, like construction of two residential towers at One Water Street in Kelowna, are helping the Thompson-Okanagan region bounce back from the slowdown on new construction caused by COVID-19 in 2020.
February 19, 2021 - 2:30 PM

There was a 13.3 per cent drop in new home construction starts in the Thompson-Okanagan region last year, but that was better than the rest of the province.

“The COVID-19 pandemic added considerable economic uncertainty in 2020 and disrupted normal migration and investment patterns,” Karen Christiansen, a Kelowna accountant speaking for the Chartered Professional Accountants of B.C., said in a news release.

“As a result, housing starts fell in the Thompson-Okanagan. However, the region recovered from the low experienced in the first quarter of 2020 and fared better than the province overall where starts were down by nearly a fifth.”

Construction began on 3,259 housing units in 2020, down about 500 from 2019, according to an annual report produced by the association each year.

“Even though housing starts faltered in 2020, it should be put in the context of the very strong years in residential development experienced in both 2018 and 2019,” Christensen wrote. “As the regional and provincial economy continue to recover in 2021, the situation is expected to improve. Housing starts should also be buoyed by major project activity and strong real estate demand in the region.”

There are 55 major projects underway with an estimated capital cost of $13 billion in the region, the release says. It describes a major project as one worth more than $15 million and includes road work as well as building construction.

“The large number of projects that are currently under construction brings economic stability to the Thompson-Okanagan,” Christiansen wrote. “As a result, our region’s economy was more resilient through the COVID-19 pandemic compared to other regions across the province. The ongoing major project activity should continue to help in 2021 and onward.”

Nine proposed projects worth $689 million are expected to start by later this year or in 2021. Another 39 major project are in the proposal stage that are worth $4.4 billion.

“It appears the worst of the economic damage is behind us, and both active and new major project investment should speed up our recovery,” Christiansen wrote.

The full report can be seen here.

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News from © iNFOnews, 2021

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