Coming on the heels of a notable decline in home sales in early 2019, British Columbia’s residential real estate market is exhibiting “much quicker than anticipated” recovery, according to Central 1 Credit Union.
Major contributors to the trend are “lower mortgage rates, first-time buyer incentives and population growth boosted by international migration,” Central 1 deputy chief economist Bryan Yu wrote in his forecast, as quoted by Western Investor.
“After a plunge in early year sales, BC’s housing markets have found themselves on firmer footing with MLS sales up in seven of eight months since February,” Yu explained.
“The demand environment has improved, despite many prospective buyers remaining on the sidelines due to federal government mortgage stress tests and various provincial tax measures, which continue to curtail purchases by both domestic and foreign buyers, specifically in the highest priced urban areas like Metro Vancouver.”
Surging demand will push BC home sales up by 12.9% next year, Yu predicted. Statistics Canada figures indicated that a significant proportion of these would likely belong to the landlord class, as many housing investors have chosen to rent out their properties.
BC had over 268,600 multiple-property owners last year alone. Vancouver is home to 53.6% (143,910 owners) of this contingent.
However, with the stronger demand comes higher market value. After an annual decline of 2.4% annually in 2019 (down to $522,000), Central 1 is expecting BC’s median housing price to grow by 3.8% next year to reach a new record of $542,000, and then further increase to $568,000 in 2021.