Image of the day: When prices go up and down, Vancouver housing supply doesn't respond

CMHC: Supply constraints increased prices of apartment condos in Canadian cities, December 2018.

When prices in Montreal go up, you get more housing starts the next year. When prices in Vancouver go up, nothing happens.

Vancouver’s housing supply resembles San Francisco rather than Atlanta. In Atlanta, when demand goes up or down, housing supply goes up or down, and prices stay stable. In San Francisco, when demand goes up or down, nothing happens to housing supply, and prices go up or down.

Jens von Bergmann notes that you would expect rising interest rates and falling prices per square foot to result in a drop in housing starts. You see this in Montreal, but not in Vancouver.