B.C. real estate group predicts dip in home sales, not in prices in 2018

Association estimates residential home sales in B.C. will go down 10.4 per cent

New mortgage qualifications and potentially higher interest rates will temper the housing market in 2018, but won’t do much to reduce housing prices, the B.C. Real Estate Association predicts.

The organization released its 2017 Fourth Quarter Housing Forecast on Tuesday, estimating a 10.4-per-cent decline in residential sales across B.C. next year. That follows an expected 8.8-per-cent drop by the end of 2017.

The numbers also show estimated home sales in 2018 are expected to dip to 91,700 units, according to the association, compared to a record-breaking 112,000 units sold in 2016.

But while the number of home sales will slow, the association’s chief economist Cameron Muir said he does not expect prices to ease up because of mortgage qualification changes set to take effect in January.

READ MORE: Here’s how mortgage requirements will change come January

“A rising interest rate environment combined with more stringent mortgage stress tests will reduce household purchasing power and erode housing affordability,” Muir said in a news release.

The imbalance between supply and demand has been largely responsible for rapidly rising home prices, Muir said, and the combination of weakening consumer demand and a surge in new home completions may induce a more balanced market condition.

Still, the average price of a home in B.C. is forecast to go up 3.1 per cent to $712,300 this year, and a further 4.6 per cent to $745,300 in 2018.

“Given the rapid rise in home prices over the past few years, the effect of these factors will likely be magnified,” Muir said.


@ashwadhwani
ashley.wadhwani@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Just Posted

“Huge disappointment” as BCVT learns Northern Sea Wolf will not sail this summer

The Nimpkish is arrriving near-empty as frustrated travelers can’t get to Bella Bella for transfer

Protection order issued after Bella Coola bear attack

Fruit trees to be removed after sow grizzly defended cubs and sent man to hospital

Bella Coola enjoys 33rd Annual Valley Ridge Riders Rodeo

Sunny skies on Monday added a welcome touch to an otherwise damp weekend

First Nation pipeline protesters erect ‘tiny homes’ in B.C. Park

Kanahus Manuel and Tiny House Warriors say more homes being constructed in park

France doubles up Croatia 4-2 to win World Cup

Played in Moscow Russia, latest Fifa World Cup marks the highest scoring final since 1966

REPLAY: B.C.’s best video this week

In case you missed it, here’s a look at replay-worthy highlights from across the province this week

B.C. teen meets Nicolas Cage

Filming mob movie in downtown Vernon, B.C.

Critics claim Trump “defended a tyrant”

Trump questions US intel, not Putin, on Russia 2016 meddling

B.C. MLAs choose new children’s watchdog

Jennifer Charlesworth has worked in government, social services

B.C. reporter calls out immigration photo on social media as fake news

A Vancouver reporter is calling out a British politician for spreading fake news

Hundreds of Arctic glaciers shrinking, disappearing

Out of 1,773 glaciers, 1,353 shrank significantly between 2000 and 2016

Indigenous housing providers worried Liberal proposals could put families on the streets

Indigenous housing providers raise alarms about future of federal funding deals

UPDATE: Fire northeast of Terrace under control

The 12.1-hectare fire was first discovered Saturday morning near Cedarvale

B.C. baseball team offers funeral prize pack

Wednesday’s West Coast League game in Victoria features draw for end-of-life package

Most Read