Canada is known for its diversity but also for being a country with a rich history of immigration. Apart from the Indigenous populations, all Canadians have come from somewhere else to make a home in our Great White North. It’s no surprise that, despite being an established popular country to apply for immigration into, Canada has seen unprecedented interest the last two years from applicants all over the world. From 2016 to 2021, Canada's population grew at almost twice the pace of every other G7 country. While the pace of growth slowed in 2020 with the COVID-19 pandemic, it rose again in 2021 and, from January to March 2022, it was the highest of all first quarters since 1990.
As of August, Canada has already openly welcomed 300,000 new permanent residents in 2022. At this rate, Canada is well on its way to exceed its 2022 immigration goal of 430,000 permanent residents. This goal was established in the Ministry of Immigration, Refugees and Citizenship Canada’s (IRCC) 2021-2023 Immigration Levels Plan (ILP), which lays out a desire for increased immigration to help the economy recover from the pandemic. In 2021, the IRCC set a historic record by admitting more than 405,000 new permanent residents to Canada.
This upward push is sure to be a prime driver for real estate values, particularly in Vancouver and Toronto. This is good news for homeowners and buyers in the market today as this push will result in more demand in an already under-supplied market – overall supporting the price of your home over the medium to long term. While a population increase will mitigate labour shortages, it’s also very likely to impact infrastructure and the availability of housing. Given that likelihood of upwards pressure, immigration is something we’re motivated to keep a close eye on to best forecast trends and plan for market shifts.
As one could assume, immigration is not evenly distributed between provinces. Some regions attract far larger influxes of groups new to Canada. Between July 1, 2020, and June 30, 2021, British Columbia saw 34,385 immigrants arrive. And while other provinces such as Ontario have a higher ranking in direct immigration, British Columbia consistently ranks among the top destinations for interprovincial migration. So, while it may not be the first landing spot of many new Canadians, the trends show that migration pressure may increase down the line.
A government committed to immigration growth
As the IRCC’s aggressive targets established in the Immigration Levels Plan show, this Federal government is committed to large immigration numbers as part of their post-pandemic recovery plan. The first year of the ILP not only surpassed its target of 401,000 new permanent residents, but it also surpassed the previous record of newcomers in a year to Canada – a record last set in 1913. The government has asserted that Canada needs immigration to drive our economy, enrich our society and support our aging population. Immigration addresses labour shortages in key sectors such as health care: immigrants make up 37% of pharmacists, 36% of physicians, 39% of dentists, 23% of registered nurses, and 35% of nurse aides and related occupations. To meet labour needs, the government launched new programs to engage essential workers, health care professionals, international graduates, and French-speaking newcomers. Although we’re in a tight labour market now, our expected retirement trends and birth rates suggest that we will have a large gap in labour in the medium to long term.
Over the course of the next year, we will be keeping a close eye on the direct impacts of immigration and how they align with the local real estate market. British Columbia will continue to see an influx in immigration and interprovincial migration over subsequent years as it is frequently ranked on of the best places to live in the world due to its core market fundamentals and economic growth potential. This is encouraging to those who choose to develop in key markets across the province because despite the shift we’ve experienced in the market over the past 6 months, demand for homes will remain strong. Immigration allows homeowners and developers to have a positive outlook on their homes as the increased demand for pre-sale product in British Columbia will result in notable price appreciation over the medium to long term.