Price and sales volume decline in Metro Vancouver and the Fraser Valley have ripple effects on the rest of the province. (Central 1 Credit Union)

B.C. housing sales predicted to slow, prices to fall in 2019

Government policies expected to drive decline for third year

This year will be the third straight where home sales decline, and for the first time since 2012, so will B.C. average home prices, Central 1 Credit Union says in its latest forecast.

“Early 2019 home sales continue to deteriorate as federal and provincial policies continue to weigh on demand and lead to price declines among some of the larger urban markets,” says the organization representing credit unions in B.C. and Ontario.

The report, Resale Housing Outlook 2019-2021, says new home starts have held steady early this year, “but a sharp pullback is expected in the second half of 2019 as weakening resale market and pre-sale conditions cool construction.”

Central 1 forecasts that housing starts will decline 14 per cent this year to 35,000 units and slip further to around 33,000 units in 2020 and 2021. The report notes that this is still above 2016 levels, and the declines are confined to larger urban markets.

The report says smaller real estate markets have generally held steady, and northern B.C. housing demand is being supported by work beginning on liquefied natural gas facilities and pipelines. Alberta’s slow economy is identified as slowing sales of recreational properties in the B.C. Interior.

RELATED: Victoria housing starts mostly rentals, CMHC says

RELATED: Canada-wide housing starts picked up in March

The federal government’s addition of a “stress test” for bank mortgages in 2018 has required borrowers to qualify their ability to pay if interest rates increase, after a long period of low rates led to personal debt rates rising. B.C. has focused on increased taxes for foreign buyers and second homes in urban areas that have low rental vacancy rates and high purchase prices.

B.C.’s foreign buyer tax and speculation tax were extended to urban areas outside Metro Vancouver, where 20 per cent declines have been seen in high-end properties and high-priced locations such as Vancouver and West Vancouver.

“Similarly, sales in Kelowna, Abbotsford-Mission and Victoria have seen their sales slumps extend into 2019,” the report says. “While not of the same magnitude, sales are lower by more than 20 per cent, year over year.

“Weak activity in Metro Vancouver is contributing to fewer recreational and retirement home purchases in other markets, as homeowners face lower price/equity and difficulty selling their properties.”


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

British couple vacationing in Vancouver detained in US after ‘accidentally’ crossing border

Parents travelling with three-month-old reportedly being held in Pennsylvania

Shoppers line up for Winners opening at Semiahmoo Shopping Centre

Popular retail store is second in South Surrey

UPDATE: RCMP shoot and kill ‘aggressive’ dog in South Surrey

Member of the public not seriously injured after dog bite

Lord Tweedsmuir downs Seaquam in high school football

The Panthers improve to 3-1, move into a tie for second in the Eastern Conference

‘A monumental step’: Surrey Food Bank finds new, much larger home in Newton

The charity is expected to make the move next summer

VIDEO: #MeToo leader launches new hashtag to mobilize U.S. voters

Tarana Burke hopes to prompt moderators to ask about sexual violence at next debate

B.C. massage therapist reprimanded, fined for exposing patients’ breasts

Registered massage therapist admits professional misconduct

B.C. boosts legal aid funding in new payment contract

‘Duty counsel’ service restored in some communities, David Eby says

Rugby Canada helps recovery efforts in Japan after typhoon cancels final match

Canadian players wanted to “give back in whatever small way they could”

$100,000 reward for B.C. gangster extended to United States

Police belive fugitive Conor D’Monte may be in the Los Angeles area

Cheating husband sues mistress for gifted ring after wife learns about affair

The husband gave his mistress $1,000 to buy herself a ring in December 2017

Emily Carr University closed Sunday after fire causes some damage

The school is working with Vancouver police to assist their investigation into the fire

After losing two baby boys, B.C. parents hope to cut through the taboo of infant death

Oct. 15 is Pregnancy and Infant Loss Awareness Day in B.C.

Alberta to join B.C.’s class-action lawsuit against opioid manufacturers, distributors

B.C. government claims opioids were falsely marketed as less addictive than other pain meds

Most Read

l -->