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

Dooris Raad was last seen in South Surrey’s Ocean Park neighbourhood on June 7. (Surrey RCMP photo)
(James Smith photo)
North Delta crime beat, week of May 31

A selection of property crimes submitted weekly by the Delta Police Department

The Lower Mainland Green Team and students from Earl Marriott Secondary remove invasive plants from White Rock’s Ruth Johnson Park. (Contributed photo)
Green Team returns to White Rock’s Ruth Johnson Park to monitor previous work

Environmental volunteers, South Surrey students remove invasive species

People were lined up around the fields at a drop-in vaccine clinic at Newton Athletic Park on Tuesday (April 27, 2021), which is one of the high-transmission neighbourhoods that are being given vaccine priority. This clinic was one of at least three to open in the city on Tuesday. (Photo: Lauren Collins)
Surrey’s weekly cases continue to drop, push for 80% vaccination rate citywide

BCCDC reports 263 cases for Surrey the week of May 30 to June 5

Friends of Bear Creek Park held a ‘yellow-ribbon event’ on Saturday (June 12, 2021), with protesters at 84th Avenue and King George Boulevard and 84th Avenue and 140th Street. People were asked to tie a yellow ribbon in their yard “to celebrate and to show support for our trees in Bear Creek Park.” (Photo: Lauren Collins)
Protesters hold ‘yellow-ribbon’ event at Surrey’s Bear Creek Park

People asked to tie a yellow ribbon in their yard to ‘show support for our trees’

At an outdoor drive-in convocation ceremony, Mount Royal University bestows an honorary Doctor of Laws on Blackfoot Elder and residential school survivor Clarence Wolfleg in Calgary on Tuesday, June 8, 2021. THE CANADIAN PRESS/Jeff McIntosh
‘You didn’t get the best of me’: Residential school survivor gets honorary doctorate

Clarence Wolfleg receives honorary doctorate from Mount Royal University, the highest honour the school gives out

Two-year-old Ivy McLeod laughs while playing with Lucky the puppy outside their Chilliwack home on Thursday, June 10, 2021. (Jenna Hauck/ Chilliwack Progress)
VIDEO: B.C. family finds ‘perfect’ puppy with limb difference for 2-year-old Ivy

Ivy has special bond with Lucky the puppy who was also born with limb difference

A million-dollar ticket was sold to an individual in Vernon from the Lotto Max draw Friday, June 11, 2021. (Photo courtesy of BCLC)
Lottery ticket worth $1 million sold in Vernon

One lucky individual holds one of 20 tickets worth $1 million from Friday’s Lotto Max draw

“65 years, I’ve carried the stories in my mind and live it every day,” says Jack Kruger. (Athena Bonneau)
‘Maybe this time they will listen’: Survivor shares stories from B.C. residential school

Jack Kruger, living in Syilx territory, wasn’t surprised by news of 215 children’s remains found on the grounds of the former Kamloops Indian Residential School

A logging truck carries its load down the Elaho Valley near in Squamish, B.C. in this file photo. THE CANADIAN PRESS/Chuck Stoody
Squamish Nation calls for old-growth logging moratorium in its territory

The nation says 44% of old-growth forests in its 6,900-square kilometre territory are protected while the rest remain at risk

Flowers and cards are left at a makeshift memorial at a monument outside the former Kamloops Indian Residential School to honour the 215 children whose remains are believed to have been discovered buried near the city in Kamloops, B.C., on Monday, May 31, 2021. THE CANADIAN PRESS/Darryl Dyck
‘Pick a Sunday:’ Indigenous leaders ask Catholics to stay home, push for apology

Indigenous leaders are calling on Catholics to stand in solidarity with residential school survivors by not attending church services

“They will never be forgotten, every child matters,” says Sioux Valley Chief Jennifer Bone in a video statement June 1. (Screen grab)
104 ‘potential graves’ detected at site of former residential school in Manitoba

Sioux Valley Dakota Nation working to identify, repatriate students buried near former Brandon residential school

The Queen Victoria statue at the B.C. legislature was splattered with what looks like red paint on Friday. (Nicole Crescenzi/News Staff)
Queen Victoria statue at B.C. legislature vandalized Friday

Statue splattered with red paint by old growth forest proponents

Most Read