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Home Sales to Decline, Home Prices to Keep Rising

 

 BCREA releases inaugural Housing Forecast

 

 

Vancouver, BC – April 26, 2007. The British Columbia Real Estate Association (BCREA) released its first semi-annual Housing Forecast report today. The report contains forecasts and analysis of the British Columbia economy and housing markets, including detailed forecasts by home type of the province’s twelve real estate board areas.

 

 

“Market forces have realigned,” said Cameron Muir , BCREA Chief Economist. “Some potential home buyers are now finding themselves at the wrong end of a price-led affordability squeeze, and home sales are forecast to edge down as a result.” MLS® residential sales are forecasted to dip 3 per cent to 93,600 units in the province in 2007, and a further 4 per cent to 89,500 units in 2008. The ten-year average is 77,811 units.

 

 

“A more balanced market is emerging in the aftermath of less frenetic buying activity and an increase in residential listings,” added Muir. The supply of active listings in the province increased 27 per cent to 32,879 units in March compared to the same month last year. “More balance between supply and demand will mean less upward pressure on home prices,” said Muir. The average MLS® residential price in the province climbed 18 per cent to $390,963 in 2006. This year, the average MLS® residential price is forecast increase a more modest 8 per cent to $422,000, and a further 7 per cent to $450,000 in 2008.

 

 

“Strong economic fundamentals will underpin housing demand through 2008,” noted Muir. “Robust labour demand is forecasted to keep job growth high and unemployment low. In addition, wages and salaries, and personal disposable income are forecast to rise well above the inflation rate.”

 

 

BC housing starts are forecasted to decline 7 per cent to 33,900 units in this year and a further 6 per cent to 32,000 units in 2008. While new home inventories remain at low levels, capacity constraints are inhibiting the ability of many BC home builders to increase production. 

 

 

- 30 -

 

 

A complete copy of BCREA’s Housing Forecast is available here: http://www.bcrea.bc.ca/economics/forecasts/2007-04 Housing Forecast.pdf

 

 

For more information, please contact:                                   

 

 

Cameron Muir

 

Chief Economist

 

Direct: 604.742.2780

 

Mobile : 778.229.1884

 

Email: cmuir@bcrea.bc.ca

 

 

Housing Forecast Table – Spring 2007

 

 

 

Unit Sales

 

Average MLS® Prices ($)

 

Board Area

 

2006

 

2007F

 

2008F

 

2006

 

2007F

 

2008F

 

Victoria

 

7,480

 

-6%

 

7,600

 

2%

 

7,350

 

-3%

 

426,722

 

11%

 

458,000

 

7%

 

485,000

 

6%

 

Vancouver Island

 

8,860

 

-7%

 

8,530

 

-4%

 

8,275

 

-3%

 

281,874

 

20%

 

295,000

 

5%

 

312,000

 

6%

 

Powell River Sunshine Coast

 

293

 

-30%

 

310

 

6%

 

325

 

5%

 

204,786

 

22%

 

230,000

 

12%

 

245,000

 

7%

 

Greater Vancouver

 

36,479

 

-14%

 

35,100

 

-4%

 

33,000

 

-6%

 

509,876

 

20%

 

545,000

 

7%

 

582,000

 

7%

 

Fraser Valley

 

18,093

 

-10%

 

17,100

 

-6%

 

16,250

 

-5%

 

393,047

 

20%

 

428,000

 

9%

 

455,000

 

6%

 

Chilliwack and District

 

3,211

 

7%

 

3,325

 

4%

 

3,375

 

2%

 

269,327

 

7%

 

305,000

 

13%

 

325,000

 

7%

 

Kamloops and District

 

3,302

 

5%

 

3,250

 

-2%

 

3,140

 

-3%

 

221,359

 

25%

 

255,000

 

15%

 

275,000

 

8%

 

Okanagan Mainline

 

7,780

 

-7%

 

7,550

 

-3%

 

7,400

 

-2%

 

324,963

 

20%

 

365,000

 

12%

 

390,000

 

7%

 

South Okanagan

 

2,199

 

-7%

 

2,080

 

-5%

 

2,010

 

-3%

 

272,521

 

19%

 

295,000

 

8%

 

315,000

 

7%

 

Kootenay

 

2,847

 

-17%

 

2,900

 

2%

 

2,850

 

-2%

 

209,895

 

21%

 

235,000

 

12%

 

248,000

 

6%

 

Northern Lights

 

502

 

-17%

 

440

 

-12%

 

425

 

-3%

 

148,694

 

24%

 

172,000

 

16%

 

185,000

 

8%

 

BC Northern

 

5,605

 

9%

 

5,400

 

-4%

 

5,290

 

-2%

 

165,380

 

20%

 

189,000

 

14%

 

197,000

 

4%

 

BC Total

 

96,671

 

-9%

 

93,600

 

-3%

 

89,700

 

-4%

 

390,963

 

18%

 

422,000

 

8%

 

450,000

 

7%

 

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