Nanaimo Quarterly Economic Update
Q3 2015

A look at the Nanaimo economic conditions,
July to September 2015. Author: Amrit Manhas, Economic Development Officer


(Source: Statistics Canada Labour force survey)

In September 2015, the unemployment rate for Nanaimo was 4.4%, considerably lower than one year ago, when it was 6.9%. BC reported an unemployment rate of 6.3%, Canada 7.0% and Vancouver Island 6.6% for September 2015. BC and Vancouver Island unemployment rates were lower one year ago, while the national rate remained unchanged. The unemployment rate for Nanaimo region was not available for the first or second quarter of 2015 as labour force survey estimates did not meet the confidence threshold. Nanaimo's participation rate was 51.3% compared to one year ago when it was reported at 60.0%. Historically, Nanaimo's participation rate has been lower than both BC and Canada. Nanaimo's working age population increased by 1,900 between third quarter comparisons.
In BC, full-time jobs (+10,600) and part-time jobs (+1,800) increased in September. However, the unemployment rate climbed 0.3 percentage points as more people entered the labour force than found jobs.
The increase in full-time employment was largely shared among adults 25 to 54 and workers 55 and over, while there were losses in full-time employment for workers aged 15 to 24.  The unemployment rate in BC in September ranked third in Canada.  Nationally employment levels experienced little change.  The unemployment rate crept up 0.1 percentage points due to growth in the labour force.

Residential Real Estate

(Source: Vancouver Island Real Estate Board; Canada Real Estate Association)

In September 2015, the average resale price of a single family home increased by 7% ($388,757) compared to September 2014 ($364,441). Homes listed increased by 7% while units sold increased by 19%. Lots listed for sale were 44% below September 2014 levels and sales improved by 7%.  Prices for lots decreased by 1% in the twelve month period between September 2015 and September 2014.  The number of Condo (apt) units listed for sale increased by 10%, while sales increased by 26%, and the average price remained virtually the same.  Patio style condo listings increased by 6% and units sold increased by 19%. Condo (townhouse) listings decreased by 12%, and sales increased by 21% while average price increased by 4%.

Every category of residential real estate posted increases in sale volumes, and prices over the twelve month period. Listings dropped for Lots and Condo (townhouse) type of accommodation but increased for single family homes, and apartment/patio type Condo units.  (note: all statistics are an average of 12 months-to-date)

Housing Construction

(Source: Canada Mortgage and Housing Corporation, latest data available)
There were 335 housing starts in Nanaimo in the second quarter of 2015, which is an increase of 113% from the same quarter in 2014. In the second quarter of 2015, 105 single-family homes were built, which is exactly the same as second quarter 2014.  Semi, Row and Apt type housing starts saw a huge increase in the same quarter comparisons.  Apt and other type of build increased by as much as 365% from second quarter 2014.
In 2014, 318 single family dwellings were built and 347 were multi-family dwellings. CMHC's latest housing forecast for Nanaimo predicts,  in 2015 single family housing construction to increase by 41.5% (132 units) and multiple dwellings to increase by 0.9% (3 Units).  Overall new housing construction in 2015 is estimated to increase by 20.3% over 2014 levels.  The forecast for 2016 is 425 single family homes and 325 for multiple units for a total of 750.  This will be a decrease of 6.3% over 2015 levels. 
Housing starts in BC's urban centres are also trending up compared to one year ago.    Robust new residential construction reflects demand for housing stemming from population growth and an active resale market.  As well inventories of completed and unabsorbed new housing have been trending lower as demand for new homes exceeds completions.  Mortgage interest rates remain low and relatively stable.  While labour market conditions have improved slightly, the underlying shift from part-time to full-time jobs provides a more solid foundation for housing demand.  Stronger gains in net interprovincial migration are also contributing to housing demand.    This represents the fifth consecutive quarterly net gain from other provinces, majority from Alberta and Ontario.


Rental Market

  • (Source: Canada Mortgage and Housing Corporation)
  • ** data suppressed to protect confidentiality or data not statistically reliable
Average rents increased in almost every category for both private apartments and row housing types. Vacancy rates decreased in each category in the spring of 2015 compared to spring of 2014.  Overall vacancy rates decreased by 2.4 percentage points for private apartment types, and by 2.9 percentage points for private row (townhouse) type.  Although fairly insignificant increase ($14), the largest increase in average rent was for 1 bedroom apartment and row housing type.  The largest drop in vacancies was for 2 bedroom row housing (3.4 percentage points).

The number of total apartment units available for rent increased from 3,527 to 3,549 as did the number of row housing units from 3744 to 3762.
(Source: Canada Mortgage and Housing Corporation)

The most recent Census (2011) indicated that 26% of Nanaimo residents rent the dwelling they live in, while 74% own their home. 
The rental vacancy rate for Nanaimo region has been declining steadily since spring of 2013 (8.3%) per graph above.  In the spring of 2015 the vacancy rate was 2.9%, while one year earlier the vacancy rate was 5.3%.   

Seniors' Housing

Demand for seniors' housing in British Columbia outpaced supply, pushing vacancy rates lower across all bedroom counts, all regions and all rent ranges.  In Nanaimo, vacancy rates dropped in most categories with the exception of bachelor type accommodation (+ 1.1pp). Rents decreased in every category of Independent living spaces.

Independent living suites are found in seniors' complexes where the majority of the residents are aged 65 years or older, on-site meal services are provided, and the residents receive less than 1.5 hours of health care per day.   In BC, the overall average rent for an independent living space was $2,868 per month in 2015, up from $ 2,811 in 2014. In Nanaimo the rent decreased from $2,650 to $2,478 over the year.  Seniors' housing vacancy rate for Nanaimo region has been dropping significantly over the past five years (i.e. 18.2% in 2012 compared to 7.5% in 2015).

Building Permits

Source: City of Nanaimo
The City of Nanaimo issued 297 building permits valued at $65.8 million in the third quarter of 2015. The value of permits issued increased by 34.28% in the third quarter 2015 compared to third quarter 2014. In comparison to second quarter 2015 building permit values in the third quarter increased by 9.55%.
86% of the building permit values in Q3 2015 were for residential construction.  12% of total value was for commercial projects, followed by 1.3% for Public and less than 1% for Industrial and miscellaneous combined. In Q3 2014, residential projects accounted for 77.65% of total building permit values followed by 17.7% for commercial units and 2.9% for Public and 1.65% for miscellaneous.


Business Licenses

Source: City of Nanaimo

In the third quarter of 2015, 175 new businesses obtained a City of Nanaimo business license. This is a 19% increase from the same quarter in 2014.  It is a 7% decrease from the second quarter in 2015.


Tourism Indicators/Passenger Volumes

(Source: Nanaimo Airport)
93,868 passengers moved through the Nanaimo Airport in the third quarter of 2015. This is an increase of 21% from the third quarter of 2014. Overall traffic through the Vancouver International Airport was up 4.7% in August 2015 compared to August 2014. Year-to-date passenger traffic through the Nanaimo airport in September was 16.55% higher in 2015 compared to one year ago.
Note: Sept data for YVR not released at the time of this publication.

(Source: BC Ferries Corporation)
The amount of vehicle traffic between Departure Bay and Horseshoe Bay increased by 2.31% (9,585 vehicles) in the third quarter of 2015, compared to the third quarter 2014.  Passenger volumes also increased by 2.09% (25,444 passengers) on this route. 
Vehicle traffic between Tsawwassen and Duke Point increased by 5.15% (11,459 vehicles) in the third quarter of 2015, compared to third quarter in 2014.  Passenger volumes increased by 5.39% on this route (29,733 passengers).  Overall in the first three quarters of 2015 BC Ferries has made significant gains in ridership after many years of reporting declines.  

(Source: Chemistry Consulting Group, Vancouver Island Conference Centre, Tourism Nanaimo)
Average occupancy reported by the accommodation sector was 1.39% lower in September 2015 compared to September 2014.  Average daily room rates increased by $8.99 year-over-year during the month of September.  Revenue available per room increased by $4.78 in September of 2015. 

Year to date overall occupancy at the end of September was up by 2.30% in 2015 compared to 2014.  Nanaimo's room rate average increased by $8.05 in 2015, while overall revenue available per room increased by $7.79 due to higher occupancy and higher room rates.

The number of visitors coming into Tourism Information Centres to obtain information on the region increased by 14.89% in the third quarter of 2015 over third quarter 2014.  Overall, visitor volumes for 2015 are 18.75% above those of 2014.  The Vancouver Island Conference Centre reported a decrease of 93.79% in delegate days at the end of September 2015 compared to September 2014.  Year to date delegate volumes are 3.31% higher in 2015 compared to 2014.