BC housing market becoming more balanced, if not more affordable

For the first time in three years, the BC Real Estate Association is suggesting there’s a better balance of supply and demand in the province.

But that doesn’t mean housing is becoming more affordable for most buyers in the Lower Mainland.

The association’s Chief Economist Cameron Muir says sales have dropped, but prices are still up more than 12 per cent in regions like Vancouver. In the Fraser Valley, they’re up 21 per cent.

“Affordability has been eroded by higher interest rates for sure, been eroded by a significant increase in prices — particularly in the condominium side over the past year,” he explains.

He adds reduced upward pressure on home prices in other parts of the province doesn’t solve the problem of inventory shortages in and around Vancouver.

Tom Davidoff with UBC’s Sauder School of Business agrees it’s difficult to predict if prices will drop over the summer, but the overall housing supply is going up “because buildings are going to complete.

“Now, those units have been pre-sold, but to the extent they were pre-sold to people hoping to flip before the building gets completed,” he says.

“In terms of affordability, really what’s most important is the rental market and obviously, some of these completed units are probably going to increase the rental stock one way or the other.”

Across BC, the average price of a home fell two per cent in May to $740 thousand.

 

Reposted from NEWS1130