It’s not news that B.C. home sales across 2018 are expected to be significantly lower than last year – but now the Canadian Real Estate Association is also predicting a further slide in 2019's resale transactions.
The CREA’s latest updated home sales forecast predicts an overall annual decline of 22.2 per cent, to 80,700 resale units sold in B.C. in 2018. That’s a significant downward revision from previous forecast. It's also lower than the annual decline seen so far in year-to-date sales, currently down 21.3 per cent, according to the latest B.C. Real Estate Association figures.
The CREA is also predicting a further slight decline in home sales next year, to a total of 80,400 transactions in 2019 – a drop of 0.4 per cent and also lower than the previous forecast.
The 2019 prediction seems to contradict the BCREA’s recent assertion that the downward trend is B.C. home sales is “largely behind us” and that sales in the province are already starting to trend upwards. The report is the latest in a series of forecasts from provindial, national and global economists that offer wildly varying opinions on the future of Canada's housing market.
CREA’s media spokesperson Pierre Leduc said in a phone interview that the national real estate association makes its forecasts independently of provincial associations’ data.
He added, “It’s a story of the impact of the mortgage qualification requirements on the B.C. market. We think it’s going to take a little while to play out.”
However, the CREA is confident that a continued slide in sales will not reduce B.C. home prices, although it expects price growth to be very muted. For 2018 it predicts a slow annual average price increase of 2.7 per cent. This is expected to be followed by a below-inflation 1.8 per cent rise in 2019, with the average price of a B.C. resale home predicted to stand at $740,500.
B.C.’s predicted 22 per cent transaction decline this year is expected to be the steepest in the country by a long shot, with Ontario following with an 11.8 per cent annual sales decrease. Seven of the 10 provinces are expected to see sales drops this year, but only four are forecast to see further declines in 2019.
Québec – driven by sales and price gains in red-hot Montréal – is the province to buck the trend in the most significant way, with home sales and average prices predicted to be up both this year and next.
Across Canada as a whole, total home sales this year are predicted to be 9.8 per cent lower than in 2017, but then increase by 2.1 per cent in 2019.
The average sale price across the nation follows a similar pattern, down slightly this year by 2.8 per cent but recovering by nearly the same amount (2.7 per cent) in 2019.
Check out the CREA's full forecast tables, below.