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.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

North Island College hosting nursing info session

Info sessions will take place Monday, Jan. 27 at Port Alberni and Campbell River campuses

Photographer captures Port Alberni personalities in black and white portraits

Meet John Douglas, Courtney Naesgaard in double exhibit Jan. 18 at Rollin Art Centre

Alberni Valley Community Foundation opens grant application process for 2020

Nearly $30K available for Port Alberni-based charities

Stray cat with ‘serious burns’ recovering at Alberni SPCA

The BC SPCA’s Alberni-Clayoquot branch is asking members of the public for help with medical costs

B.C. government puts kibosh on drag racing at Alberni Valley Regional Airport

AVDRA was hopeful for a three-year temporary contract to race at the airport

After cashing in on QB gambles, Chiefs and 49ers to clash in Super Bowl

KC beats Tennessee, San Francisco dispatches Green Bay to reach NFL title game

B.C. VIEWS: Few clouds on Horgan’s horizon

Horgan’s biggest challenge in the remainder of his term will be to keep the economy humming along

Victoria family focuses on ‘letting go, enjoying time together’ after dad gets dementia

Walter Strauss has developed an interest in music and now takes line dancing classes

B.C. forest industry grasps for hope amid seven-month strike, shutdowns, changes

Some experts say this could be worse for forestry than the 2008 financial crisis

Northern B.C. RCMP investigating alleged sexual assault in downtown Smithers

One person was transported by ambulance to hospital following RCMP investigation at Sedaz

UBC, Iranian-Canadian community create memorial scholarship in honour of victims

The Jan. 8 crash killed 176 people, including 57 Canadians

Disrespectful that Horgan won’t meet during northern B.C. tour: hereditary chief

Na’moks said he was frustrated Horgan didn’t meet with the chiefs

Most Read