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

A person receives a COVID-19 vaccine at a vaccination clinic run by Vancouver Coastal Health, in Richmond, B.C., Saturday, April 10, 2021. (THE CANADIAN PRESS/Jonathan Hayward)
Local youth vaccination clinics underway

Pfizer vaccine will be used

Priya Sharma. (Submitted)
Column: Why ultimatums don’t work

By Priya Sharma It is a common misconception that people can choose… Continue reading

People had a chance to interact with different animals at the petting zoo, participate in mutton busting, and buy everything local during the Fall Fair held in 2019. (Aman Parhar/Omineca Express)
55th Fall Fair in Vanderhoof cancelled

Alternative events eyed once again

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

FILE – A science class at L.A. Matheson Secondary in Surrey, B.C. on March 12, 2021. (Lauren Collins/Surrey Now Leader)
Teachers’ union wants more COVID transmission data as B.C. prepares for back-to-school

BCTF says that details will be important as province works on plan for September

Provincial health officer Dr. Bonnie Henry outlines B.C.’s COVID-19 restart plan, May 25, 2021, including larger gatherings and a possible easing of mandatory masks on July 1. (B.C. government photo)
B.C. records 120 new COVID-19 cases, second vaccines accelerating

Lower Pfizer deliveries for early July, Moderna shipments up

A Heffley Creek peacock caught not one - but two - lifts on a logging truck this month. (Photo submitted)
Heffley Creek-area peacock hops logging trucks in search of love

Peacock hitched two lifts in the past month

The Calgary skyline is seen on Friday, Sept. 15, 2017. THE CANADIAN PRESS/Jeff McIntosh
2 deaths from COVID-19 Delta variant in Alberta, 1 patient was fully immunized

Kerry Williamson with Alberta Health Services says the patients likely acquired the virus in the hospital

The first suspension bridge is the tallest in Canada, with a second suspension bridge just below it. The two are connected by a trail that’s just over 1 km. (Claire Palmer photo)
PHOTOS: The highest suspension bridges in Canada just opened in B.C.

The Skybridge in Golden allows visitors to take in views standing at 130 and 80 metres

BC Green Party leader and Cowichan Valley MLA Sonia Furstenau introduced a petition to the provincial legislature on Thursday calling for the end of old-growth logging in the province. (File photo)
BC Green leader Furstenau introduces old-growth logging petition

Party calls for the end of old-growth logging as protests in Fairy Creek continue

B.C. Premier John Horgan leaves his office for a news conference in the legislature rose garden, June 3, 2020. (B.C. government photo)
B.C. premier roasted for office budget, taxing COVID-19 benefits

Youth addiction law that triggered election hasn’t appeared

A vial containing the Moderna COVID-19 vaccine is shown at a vaccination site in Marcq en Baroeul, outside Lille, northern France, Saturday, March 20, 2021. THE CANADIAN PRESS/AP/Michel Spingler
mRNA vaccines ‘preferred’ for all Canadians, including as 2nd dose after AstraZeneca: NACI

New recommendations prioritizes Pfizer, Moderna in almost all cases

Most Read