Average home prices across Canada and in BC are expected to increase by 5.7 per cent in 2014 but by less than 1 per cent in 2015, according to an updated forecast by the Canadian Real Estate Association(CREA) released July 8.
Sales are forecast to reach 463,400 units in 2014 an increase of 1.2 per cent compared with 2013. This is slightly down from CREA's earlier forecast of 463,700 sales, a rise of 1.3 per cent, published in March.
BC is forecast to post 2014's largest year-over-year increase in sales activity at 8.3 per cent and make the biggest contribution to the national increase in sales activity.
The CREA report says that very bad winter weather across Canada resulted in slow start to 2014 national sales activity. As the first quarter ended, sales momentum heading into spring was limited by a continuing shortage of listings in several markets. However, the CREA reports that an increase in inventory in April and May sparked an rise in sales activity.
Activity is still expected to remain in line with its 10-year average at nearly 450,000 units for the seventh consecutive year.
The CREA says that in 2015, the outlook for the economy, jobs and incomes is one of further improvement, accompanied by a slow and gradual increase in fixed and variable mortgage interest rates.
National activity is now forecast to reach 467,800 units in 2015, an annual increase of 0.9 per cent. This would result in sales staying in line with the 10-year average for the eighth year in a row.
Sales activity in BC in 2015 is forecast to remain static as the CREA says that predicted interest rate rises are expected to take a bigger toll on activity in the least affordable provinces.
