As a result of COVID-19, several economists are expecting a contraction in the BC new construction market forecast for 2020. Central 1 Credit Union expects home sale volumes will plummet 30% through the middle of the year, following the trajectory of the rest of the economy. In addition, a similar rate of decline is expected for housing starts with new residential construction forecast to fall from 45,000 units in 2019 to 31,400 units in 2020.
The news is not as bleak as some would lead you to believe. Unlike past recessions where a combination of market forces collapsed the global economy, the current economic challenges are due to a government shutdown of the economy. We are fortunate to live in a country wealthy enough to subsidize industries, businesses, and individuals during such a shut down. The economic recovery is anticipated to be relatively strong and quick after a steep drop in 2020.
It will take time for the new construction market to rebound to pre-pandemic levels. It is forecasted that the pent-up demand will cause residential construction GDP to rise by 6.2% to $8.74 billion in 2021. A further 6.7% increase to $9.3 billion is expected in 2021. The demand for homes sales will stimulate the new construction industry after pandemic fears begin to subside.
The BC new construction market forecast for 2020 directly and indirectly affects many other industries as well. Everything from aggregate mining, transportation, material supply, equipment manufacturing and sales.
Some construction companies will be hesitant to invest in new equipment during market uncertainty. Even so, business owners know the importance of maintain their existing equipment fleet to ensure they can capitalize on new opportunities.
Handlers Equipment Service Center services all makes and models of agriculture and construction equipment. Our experienced mechanics can provide new repairs or general maintenance to keep your equipment in peak operating condition.