Building a budget for your upcoming real estate project
Understanding the development costs and trends
The development costs for an upcoming real estate project includes more than labour and material costs. For instance, development costs can be affected by global and local economic conditions, market trends, and advances in building materials, practices, and approaches.
Entering into 2020, the real estate market saw low vacancies and strong demand for housing activity. In the Greater Toronto Area, sales activity is expected to remain strong. Meanwhile, in Vancouver, there is predicted to be an increase in demand for residential land. Furthermore, in Vancouver, commercial real estate investment demand is expected to remain high.
Private Sector Development Costs
The Altus Group has conducted research on the development costs for selected areas across Canada. These projected numbers, listed in the table below, can help developers build their initial budget for their upcoming projects.
Above all, the most important information to highlight from this report is that development costs range greatly across Canada. Furthermore, the costs can vary based on the type of building. Lastly, it appears the two regions with the projected highest costs in the private sector per square foot are Vancouver and the Greater Toronto Area.
Source: Atlus Group, 2020 Canadian Cost Guide
You can view the full report here: https://www.altusgroup.com/services/reports/2020-canadian-cost-guide/