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B.C.'s housing market healthy and will bounce back

28 October 2019
Sutton Showplace Realty Chilliwack

The local housing market is healthier and will start to bounce back through 2020 and into 2021, according to the latest report by the Canada Mortgage and Housing Corporation.

Ontario’s and British Columbia’s outlooks for sales growth are relatively strong in 2020 and 2021 when compared to other regions, consistent with growth in real disposable income that is forecast to exceed the national average over this time period.

B.C. is also expected to see relatively strong growth in new builds.

Prices are also forecast to see a modest recovery in B.C., after a dip in 2019, with B.C. seeing up to the second highest price growth after Ontario in 2021. Other regions will generally see modest gains.

However, CMHC says global trade tensions and continued high levels of household debt are still risks to both the economy and housing activity across the country.

It also says that higher interest rates or a rise in unemployment could hit already strained budgets and put pressure on housing activity.

Recent measures of overvaluation for the major markets of Vancouver and Toronto as well as for those in their vicinity indicate a general easing of vulnerabilities, as prices have been gradually aligning more with fundamentals in recent quarters.

The current outlook for renewed growth in home prices doesn’t imply overvaluation and or price acceleration measures will necessarily worsen, since growth in fundamentals over the same time period can be sufficient to support stronger resale market activity and price growth.

Housing starts across the country should come in at around 200,000 units next year after declining this year and last.

Home prices are also expected to start growing in 2020 and 2021 to raise the average price above the 2017 peak.

Article by: https://www.citynews1130.com/2019/10/24/cmhc-expects-housing-market-to-recover-in-next-two-years-after-declines/

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