RECESSIONARY CONDITIONS SLOW HOUSING MARKET, BCREA Forecast Update – First Quarter 2009

BC MULTIPLE LISTING SERVICE® (MLS®) residential sales are forecast to decline 9 per cent from 68,923 units in 2008 to 62,650 units this year. Residential sales in 2010 are forecast to rebound 8 per cent to 68,000 units. The ten-year average is 82,800 units.

“The global financial crisis and world-wide recession will continue to take their toll on the BC economy this year,” said Cameron Muir, BCREA Chief Economist. “World events have pulled Canada and BC into a recession, where concern for job security and declining net worth are keeping many potential homebuyers on the sidelines.”

“A continuing imbalance between supply and demand will put some additional downward pressure on home prices this year,” added Muir.

The average MLS® residential price is forecast to decline 13 per cent to $396,600 in 2009. Home prices in the province are expected to be relatively stable in 2010, forecasted to average $389,000.

BC housing starts are forecast to fall 45 per cent to 19,000 units this year as a result of rising inventories, weak consumer demand and tight credit conditions.

Next year is expected to be a year of stabilization in the economy and the housing market. Real GDP growth in the province is forecast to rise a modest 1.5 per cent and job losses in 2009 are expected to give way to some gains in employment in 2010.

Home Inspector Licensing Good for Consumers, BCREA February 3, 2009
“As a REALTOR®, I know it’s important for my clients to have the best property information possible,” said BCREA President Scott Veitch. “An independent inspection is a great starting point for consumers to learn about property conditions.”

Since 1998, the Association has recommended the government license home inspectors. Now, BCREA looks forward to the development of meaningful standards to ensure consumers receive adequate protection.

“Solid information helps consumers have confidence in their home buying decisions,” added Veitch. “And confidence and protection are necessary for the excellent quality of life we enjoy in British Columbia.”

BC Home Sales Start with a Whimper in 2009, BCREA February 16 2009

British Columbia Real Estate Association (BCREA) reports residential sales dollar volume on the Multiple Listing Service® (MLS®) in BC declined 61 per cent to $873 million in January, compared to the same month last year. Residential unit sales fell 57 per cent to 2,115 units during the same period. The average MLS® residential price in the province was $412,934 in January, down 9 per cent from January 2008.
“Home sales were sluggish in January, reflecting an overall malaise in consumer confidence and a weakening provincial economy,” said Cameron Muir, BCREA Chief Economist.

BC MLS® Residential Sales

“Reports of an increasing number of consumers shopping for a home have yet to materialize in the sales statistics,” added Muir. “The large selection of homes for sale in January likely reduced any sense of urgency for potential homebuyers to commit to a purchase.”

Improving home affordability resulting from lower mortgage rates and home prices is expected to elevate sales activity in the province this spring.

For more information, please contact:

Cameron Muir
Chief Economist
Direct: 604.742.2780
Mobile: 778.229.1884
Email: cmuir@bcrea.bc.ca