Category: B.C. Real Estate News

This article appeared in the Vancouver Sun on October 20, 2009 and was written by Derrick Penner.

The rebound in B.C. housing sales from the recession is the strongest on record, Central 1 Credit Union said Tuesday, predicting that property prices will regain all of their downturn losses by the end of this year.

Central 1 chief economist Helmut Pastrick said the housing sales rebound has already surpassed the strength of the recovery from the 1991 recession. Pastrick said the resurgence has combined with diminishing inventories of unsold homes to force prices upward. Prices will eventually hit an “affordability squeeze,” Pastrick said, reaching a ceiling that forces new buyers out of the market.

However, in one of the first major fall housing forecasts, Pastrick said observers should not “underestimate the power of … very low and attractive mortgage rates” to keep driving the market. He said that as buyers embrace historically low mortgage rates, that momentum “will carry into 2010, driving unit sales and prices to new highs.”

He predicted that, on an annualized basis, the overall average home price in B.C. will climb to a new high of $463,800 by the end of 2009, erasing recession-era losses, before advancing to $497,800 in 2010 and $534,800 in 2011. He also forecast that sales through the Multiple Listing Service across the province will climb to 85,500 this year, and 109,000 in 2010.

Not all regions will experience the recovery equally, Pastrick said. The gains will be concentrated in the bigger, higher-priced markets of Vancouver, the Lower Mainland and the Okanagan, and no single region will see annualized average prices for 2009 surpass previous peaks.

Pastrick said his forecast relies on B.C. continuing to recover from the recession, and that at some point in 2010 the pace of sales will slow down. He expects sales transactions to slip to 101,400 in 2011, though prices should continue to rise.

The Central 1 forecast calls for B.C. housing starts, after falling to 14,600 units this year from 34,321 in 2008, to recover to 21,400 units in 2010. “If [economic] recovery is weak, or does not come, then prices could potentially stop rising and back off somewhat,” Pastrick said.

Carol Frketich, regional economist for Canada Mortgage and Housing Corp., said in an interview the Central 1 forecast is consistent with other forecasts for the B.C. market. Frketich said forecasters are getting a very strong signal from housing resale activity that points to an overall pickup in housing.

However, she said the fact that Lower Mainland markets have accounted for 40 per cent of total provincial sales has had an influence on provincial totals. A lot of higher-priced homes have been selling in the region, which helps push up the average provincial price.

The Lower Mainland has also seen its unemployment levels decline, another positive indicator that economic conditions will improve. “The key to strength in the housing market is, we need to see the recovery continue, and mortgage rates staying relatively low,” Frketich said. “And currently, those are the conditions we have.”

Cameron Muir, chief economist for the B.C. Real Estate Association, however, maintained a more conservative outlook for home-price growth, given that the market is up against a slow economic recovery. “My expectation is that home prices will grow very modestly in 2010,” Muir said. Muir said much of the buying activity in the market is the result of demand that built up during last fall’s market collapse.

However, as that demand is filled, and as mortgage rates rise in the latter half of 2010, Muir said he expects sales will ease off the record pace that Pastrick has predicted, “reflecting an economy that is coming out of recession.”

 

This news release came out from the Ministry of Housing and Social Development September 21, 2009. Do you think these changes will affect the sale of strata real estate in Kamloops?

Changes to the Strata Property Act will create more rental housing and improve the dispute resolution process for strata owners and strata corporations, Housing and Social Development Minister Rich Coleman announced today.

“These amendments will help owners and buyers protect their hard-earned investments,” said Coleman. “As well, in new strata developments, owners, tenants and buyers will have greater flexibility to rent a strata unit, creating more rental units, which we know are in demand in our tight housing market here in British Columbia.”

The proposals will mean that new strata corporations cannot change rules about rental units that impact the rights of owners and purchasers or the marketability of the units. Owners will be able to continue to rent their units until the date the rental period originally disclosed by the developer expires. Existing strata owners will not be affected by the change.

“We support legislative amendments that will result in more rental units coming onto the market,” said Martha Lewis, executive director of the Tenant Resource and Advisory Centre. “It is upsetting to have condo units sitting empty at a time when many people are searching for appropriate housing. The sooner the amendments come into effect, the better.”

The proposed changes will allow disputes to be heard in Small Claims Court, rather than the B.C. Supreme Court. Strata corporations and strata owners will also be able to use arbitration or mediation rather than going to court. Strata corporations will have to provide audited financial statements and obtain depreciation reports to help them prepare for future repairs or upgrades. Owners and potential buyers will be able to access these reports.

The amendments also confirm that strata corporations can set age restriction bylaws to create adult and seniors’ communities, under both the Strata Property Act and the BC Human Rights Code.

The Strata Property Act provides a framework for the creation and operation of strata developments in British Columbia and sets out the guidelines under which strata corporations must operate. Amendments were previously introduced earlier in 2009.

Contact:
Seumas Gordon: Media Relations Officer,  Ministry of Housing and Social Development Phone: 250 387-6490

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This article was written by Derrick Penner of the Vancouver Sun today. The Kamloops real estate market has seen downward pressure on housing prices over the last nine months. This article states that we will see continued pressure on housing prices for some time to come. Read below for the full story.

While British Columbia real estate sales have lifted from last fall’s dismal lows, market oversupply and deteriorating economic conditions will still pressure prices downwards, according to Scotia Economics.

March and April saw “pretty strong sales volumes” across the country, said Adrienne Warren, a senior economist with Scotia Economics, the Bank of Nova Scotia’s economic-research division. However, “prices are not really firming up [in B.C.] as we’ve seen in some other parts of the country,” she said Tuesday. “There is still a bit of correction going on in a lot of western markets: Vancouver, Calgary and Edmonton, where they are still working through some overshooting of prices and excess supply.” That, she added, will mean “a little more downward pressure on prices” than what is occurring in central and Atlantic Canada.

The area of Metro Vancouver covered by the Real Estate Board of Greater Vancouver saw 2,963 sales recorded through the realtor-operated Multiple Listing Service in April, which was down eight per cent from the 3,218 sales recorded in April 2008. That number, however, represented a 31-per-cent jump over March 2009 sales, a month that typically shows more sales than April.

And while Metro Vancouver’s main real estate board reported that inventories of new, unsold listings declined for the sixth straight month, Warren said Vancouver still has an oversupply of unsold homes, both among new homes under construction and in the resale market. “It was a much more unbalanced market six months ago,” Warren said, “and we’re beginning to see a fairly sharp drop-off in new listings.”

That drop, she added, shows that Canadians, in general, aren’t being forced into selling homes or being foreclosed on like troubled buyers in the United States.

At the same time, according to Scotia Economics’ calculations, the pace of MLS home sales to April in Metro Vancouver, expressed as an annualized figure, is running almost 25 per cent below the pace of sales in 2008. Scotia Economics’ average price in Metro Vancouver of $494,485, also expressed on an annualized basis, is down 17 per cent from an annualized average price of $593,767 in 2008. “You’ll probably see prices stabilize over the next six months,” Warren said, “at least by the end of the year.”

She anticipates prices will continue that stable trend in 2010 without much of a sharp rebound, largely because of B.C.’s deteriorating economic conditions and rising unemployment. “Low interest rates, tax incentives by the federal government and more choice in the marketplace have done what they should in a cyclical pattern,” Warren said, “which is bringing buyers back into the market.” “But you’ve got to remember the gains we’re seeing are after very low levels late last year.” The report said a rise in demand and drop in new listings has resulted in the market moving closer to “balanced.”