A more vibrant economy and a wealthier consumer base will drive much of the recovery
Favourable economic and demographic conditions are expected to lead to a “bottoming out” of BC’s housing slowdown within two years, according to a new RE/MAX analysis.
Citing trends data from the Canada Mortgage and Housing Corporation, starts are expected to hover between a low of 39,300 and a high of 42,300 by the end of this year, and a low of 40,700 and a high of 44,700 in 2020.
This is likely to further intensify onto a low of 41,900 starts and a high of 46,900 by 2021.
Meanwhile, sales are projected to climb to a maximum of 84,400 in 2020 and 90,800 in 2021. This, after the muted 78,000 transactions in 2018 and a further dip to around 69,000 this year.
Fortunately, overall growth remains robust, despite the relative market slowdown of the last few years. Demand for Vancouver’s condos is currently the main driver of stability, according to figures from Statistics Canada.
As of the third quarter, condo prices were down by 3.49% annually, but up by 17.9% from Q1 2017. New build condos were up 1.05% year-over-year and up 15.63% from Q1 2017.
“The area has definitely suffered due to property overvaluation in Vancouver and other regions of the province, but this should still not discourage the predicted increase in both sales and home prices,” CMHC stated.
By the end of 2019, the benchmark home price range in BC is expected to hover between $656,600 and $723,400. The market value will likely strengthen to the $675,100 - $749,500 range in 2020, and $718,400 - $801,600 by 2021.
