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

OPINION: Old enough to know what’s been lost in B.C. salmon

Stephen Hume writes about the lack of discussion on the province’s dwindling salmon population

Anonymous Good Samaritan pays outstanding rent for Sidney woman facing eviction

Zora Hlevnjak, 76, supplements her pension by collecting cans and receiving public donations

Vancouver Island kids shovel for charity

Group of Parksville youngsters will donate the $185 raised digging out the neighbourhood

‘We feel forgotten’: Colwood residents stranded inside seniors apartment due to uncleared snow

All of the 60 residents at Colwood Lodge are living with some sort of disability

Hwy. 14 closed, near Jordan River, due to down hydro lines

No information on when the highway will reopen

‘Scariest boat ride of my life’: Passengers trapped by ice on rocky B.C. ferry sailing

The Nimpkish docked in Bella Coola on Jan.12 coated in a thick layer of ice

Bike lane snow clearing anger misplaced, says Victoria

Some residents accusing city of prioritizing cycling paths over roads and sidewalks

Province puts kibosh on drag racing at Alberni Valley Regional Airport

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

Remaining Danbrook One tenants ordered to vacate immediately

Property management company offering each unit $1,000 in ‘compassionate assistance’

Island winter storms good news for Mount Washington

The resort received 46cm within the last 24 hours, for a total snowbase of 130 cm.

Flood at Cedar Hill Golf Course clubhouse leads to six-month closure

Golf course not affected, will reopen once snow melts

VicPD seizes significant amount of drugs, loaded guns in three separate stings

Three separate busts over five months led to seizures, four individuals taken into custody

Theatre production brings Inuit creation myths to the stage in Nanaimo

‘Unikkaaqtuat’ combines music, illustrations and circus arts

Most Read