The latest forecast from the British Columbia Real Estate Association (BCREA) says residential sales will increase 5.6 per cent in 2013 and another 6.1 per cent in 2014. In Metro Vancouver, the bounce back will be even more dramatic with homes sales expected to increase nearly 10 per cent in 2013 after a nearly declining 23 per cent in 2012.
“2013 is shaping up to be a transition year in the BC housing market,” stated BCREA chief economist Cameron Muir in a news release.
“Residential values are expected to be on a more solid footing in 2013 as lower prices, both actual and inflation adjusted, have improved affordability. Many potential buyers that stayed on the sidelines in 2012 will likely enter the marketplace over the next year as the relatively strong financial condition of BC households precludes any deflationary spiral,” he continued.
Meanwhile, the average residential price in BC is forecast to edge down nearly one per cent to $510,400 this year and remain relatively unchanged in 2014, albeit up 0.6 per cent to $513,500.
For BC housing starts, the expectation is that they will edge back 3.5 per cent to 26,500 units this year, after remaining unchanged in 2012. A spillover effect of more subdued consumer demand last year will keep home builders from adding too much supply to the market, BCREA says. In addition, the transition from the HST back to the PST may add a short term boost to new home sales this spring. A modest 1.5 per cent increase in housing starts to 26,900 units is forecast for 2014, keeping new additions to the housing stock in line with household growth.
This chart provides a snapshot of the provincial forecast broken down by region.