Home sales expected to cool down in 2023: BCREA
Posted February 6, 2023 6:56 am.
Last Updated February 6, 2023 6:33 pm.
Home sales in B.C. are forecasted to cool down even more this year before a bounce back in 2024.
The B.C. Real Estate Association (BCREA) predicts high mortgage rates and a slowing economy will be factors in keeping housing sales in the province down until next year.
The BCREA sees 2024 as a year where interest rates could drop down, and immigration is predicted to hit a record high. One expert says everything in the market boils down to interest rates and immigration.
“Those two factors mean we’re set up for a pretty strong 2024,” said Chief Economist Brendon Ogmundson. “A lot of the adjustment that we’re seeing in the market right now is really about single family homes.”
Ogmundson explains the pandemic had a major ripple effect on the province’s housing market, especially in single family homes.
“There was a huge rush of buyers in the single family homes because everybody wanted square footage, everyone wanted space, and that really drove up demand for single family homes, especially in more affordable market,” he said.
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Growth just slows down eventually according to Ogmundson, and a bounce back takes time.
“We should see the Bank of Canada start to take their foot off the brake at some point, they’ve already signaled they’re going to be on hold. When they might actually lower rates is really up for debate, maybe end of 2023, maybe not till 2024,” he explained.
The BCREA forecasts home sales will drop this year by over seven per cent in Greater Vancouver, and 13 per cent in the Fraser Valley.
When the forecasted hike eventually happens, overall home sales in B.C. are expected to surge by nearly 24 per cent.
With files from OMNI and The Canadian Press
