B.C. average home price and sales level to 2023, showing steep drop in sales expected next year. (Central 1)

B.C. average home price and sales level to 2023, showing steep drop in sales expected next year. (Central 1)

Forecast calls for B.C. home sales to ‘explode,’ then drop off

Average price to rise another 10% in 2021, credit unions say

B.C.’s red-hot pace of real estate sales will grow by another 37 per cent in 2021 and then drop by 21 per cent in 2022, but prices will continue their upward climb, according to a new forecast by credit union group Central 1.

The median retail price of a B.C. home is projected to increase by 10 per cent this year to $643,000, another 4.2 per cent to $670,000 in 2022, and three per cent to $690,000 in 2023, despite the expected peak and sharp decline in sales activity. Housing starts driven by demand are also expected to increase 10 per cent this year, then level off for 2022 as immigration to Canada has slowed down.

“Year-over-year sales growth will explode in the coming months, following a doubling of MLS home sales observed between March 2020 and March 2021, reflecting record levels of current sales and weakness early in the pandemic period,” Central 1 chief economist Bryan Yu said in his latest B.C. housing market analysis.

Prior to the COVID-19 pandemic, foreign purchasers were the focus of government action, with the former B.C. Liberal government imposing a foreign buyers’ tax and the NDP government following up with its speculation and vacancy tax that also levied its highest rate on property owners outside of Canada.

RELATED: Bidding wars driving up Lower Mainland home prices

RELATED: Rent freeze, construction rules contribute to shortage

With foreign purchasing down to 1.5 per cent of the total, Yu described a “perfect storm” of demand from people in higher-paying jobs working from home and saving for down payments as travel and recreation spending was shut down. And governments have been preoccupied with the pandemic.

“The lack of government intervention may reflect limited tools to temper the market, given the surge of activity is driven by domestic buyers who have strong credit and are already subject to mortgage stress tests,” Yu said. “The primary drivers of the current boom are low borrowing costs and a shift in household pandemic preferences. Both are outside the control of policy makers and are expected to naturally wane as the pandemic eases.”


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislatureCoronavirusReal estate

Just Posted

Kimberly Bussiere and other laid-off employees of Casino Nanaimo have launched a class-action lawsuit against the Great Canadian Gaming Corporation. (Chris Bush/News Bulletin)
Laid-off Casino Nanaimo workers launch class-action lawsuit against corporation

Notice of civil claim filed on April 6 at Supreme Court of B.C. in Nanaimo

Al Kowalko drives Sooke School District’s first electric bus that began operation in May. The board decided on June 15 that all future buses will be electric, asking the province for more funding to support the program. (Zoe Ducklow/News Staff)
Sooke school board agrees to make all future buses electric

Board to ask province to increase funding to cover the extra up front cost

Camper the dog was found Wednesday night by someone walking their own dog along Hollywood Crescent. She had gone missing after a violent attack on June 11. (Courtesy of VicPD)
Camper the dog found safe after fleeing violent van attack in Victoria

Camper was found on Hollywood Crescent Wednesday night

A lift on marine border restrictions by next summer would bring an economic gain to Greater Victoria through the cruise industry. (Black Press Media file photo)
Saanich calls for opening of marine borders by summer 2022

Council to ask feds to end restrictions in time to allow planning for next cruise ship season

In January 2019, Grade 5 students from Glenlyon Norfolk School, accompanied by Grade 11 student Anastasia Castro, gave a presentation to Oak Bay council seeking a ban on plastic bags in the district. (Black Press Media file photo)
Oak Bay set to survey businesses on single-use plastic products

Survey gathers information ahead of expected legislation on provincial, federal level

People line up to get their COVID-19 vaccine at a vaccination centre, Thursday, June 10, 2021 in Montreal. THE CANADIAN PRESS/Ryan Remiorz
Vaccines, low COVID case counts increase Father’s Day hope, but risk is still there

Expert says people will have to do their own risk calculus before popping in on Papa

House Majority Whip James Clyburn, D-S.C., center left, reaches over to Rep. Maxine Waters, D-Calif., joined by Speaker of the House Nancy Pelosi, D-Calif., center, and members of the Congressional Black Caucus as they celebrate the Juneteenth National Independence Day Act that creates a new federal holiday to commemorate June 19, 1865, when Union soldiers brought the news of freedom to enslaved Black people after the Civil War, at the Capitol in Washington, Thursday, June 17, 2021. It’s the first new federal holiday since Martin Luther King Jr. Day was created in 1983. (AP Photo/J. Scott Applewhite)
Biden to sign bill making Juneteenth a federal holiday

New American stat marks the nation’s end of slavery

John Kromhoff with some of the many birthday cards he received from ‘pretty near every place in the world’ after the family of the Langley centenarian let it be known that he wasn’t expecting many cards for his 100th birthday. (Special to Langley Advance Times)
Cards from all over the world flood in for B.C. man’s 100th birthday

An online invitation by his family produced a flood of cards to mark his 100th birthday

FILE – Nurse Iciar Bercian prepares a shot at a vaccine clinic for the homeless in Calgary, Alta., Wednesday, June 2, 2021. THE CANADIAN PRESS/Jeff McIntosh
B.C. scientists to study effectiveness of COVID vaccines in people with HIV

People living with HIV often require higher doses of other vaccines

A 50-year-old woman lost control of her vehicle Tuesday, June 15, crashing through a West Vancouver school fence that surrounds playing children. (West Vancouver Police)
Driver ticketed for speeding near B.C. school crashes into playground fence days later

‘It’s an absolute miracle that nobody was injured,’ says Const. Kevin Goodmurphy

Dr. Réka Gustafson, who is British Columbia’s deputy provincial health officer, speaks during a news conference in Vancouver on April 8, 2015. THE CANADIAN PRESS/Darryl Dyck
B.C. public health officials prepare to manage COVID-19 differently in the future

Flu-like? Health officials anticipate shift from pandemic to communicable disease control strategies

Maxwell Johnson is seen in Bella Bella, B.C., in an undated photo. The Indigenous man from British Columbia has filed complaints with the B.C. Human Rights Tribunal and the Canadian Human Rights Commission after he and his granddaughter were handcuffed when they tried to open a bank account. THE CANADIAN PRESS/HO-Heiltsuk Nation, Damien Gillis, *MANDATORY CREDIT*
VIDEO: Chiefs join human rights case of Indigenous man handcuffed by police in B.C. bank

Maxwell Johnson said he wants change, not just words, from Vancouver police

Most Read