Multiple Listing Service® (MLS®) residential sales in the province are forecast to decline 1.8 per cent to about 77,100 units this year, after recording 78,505 residential sales in 2018. MLS® residential sales are forecast to increase 10.9 per cent to 85,500 units in 2020, just below the 10-year average for MLS® residential sales of 85,800 units.
“After a slow start to 2019, MLS® home sales in BC have embarked on a sustained upward trend since the spring,” said Brendon Ogmundson, BCREA Chief Economist. “The dampening effects of federal mortgage rules mean that rather than a return to the heights of recent years, home sales are simply returning to trend after sustaining a significant shock.”
As demand normalizes, the accumulation of resale inventory has reversed course in many markets around BC. We anticipate that this trend will continue in 2020, with sales and listings finding balance. For most markets, this will mean price growth that is in-line with inflation, though for some supply-constrained areas we are forecasting strong price growth. We anticipate that the MLS® average price will decline 2 per cent in 2019 before rising modestly by 3.6 per cent to $723,000 in 2020.
Unexpectedly strong new home construction activity continued in 2019, particularly in Metro Vancouver. Total provincial housing starts are forecast to rise close to 8 per cent this year, surpassing the 40,000-unit mark for a third consecutive year and reaching a record high of 44,000 total starts. That elevated pace of new home construction adds to an already
large pipeline of homes under construction. The overwhelming majority of those units are apartments, which have long and variable completion times. However, as this supply is added to the market, future price growth will likely be constrained. [full report]