Vancouver Real Estate Market Insight

As we enter the Fall market we thought we’d take a look at what a couple of Vancouver’s market mavens are thinking, when it comes to the BC economy and real estate.

West Coast economic soothsayer Helmut Pastrick at Central Credit Union of B.C remains bullish on the overall economic outlook to 2010.

CCU’s latest economic update forsees low financing costs, higher income growth and rising population growth bolstering consumer spending and housing market activity.

“B.C.’s economy will remain in a robust growth phase until at least 2010, with business investment being the driving force. Real gross domestic product is forecast to grow at slightly above four percent a year from 2006 to 2010.”

“Residential housing sales are forecast to dip slightly this year, but rebound by six per cent in 2007 to 141,800 units, exceeding the 2005 high. While fewer sales to first-time buyers are expected, existing owners and investors will be more active in selling and buying homes.

The average price of sales through the Residential Multiple Listing Service® (MLS) is forecast to rise by about 14 per cent this year and 7 per cent in 2007. Larger price increases are foreseen in the Kamloops, Kootenay, South Okanagan, Vancouver Island (excluding Victoria) and B.C. Northern real estate board areas. Housing speculation remains relatively low in nearly all markets.”

In a similar though less upbeat vein, Carol Frketich, CMHCs BC regional economist reckons “this year also represents the likely peak in the current housing cycle as rising mortgage rates and higher home prices work to slow demand”.

“Both new home construction and resale activity will slow in 2007 but the level of activity will remain higher than average”, added Frketich.

Insight: The market has changed and is changing and the spectacular price growth we saw in the last few years is already in the rear view mirror. The Vancouver market is made up of numerous sub-markets based on location, age of property and property type.So make sure your assumptions about the market’s direction is based on fact and is appropriate for the area and type of property you are buying.