File photo. (Ragnar Haagen/News staff)

‘Subdued’ housing market predicted in B.C. through 2021: report

The Central 1 Credit Union report predicts “rising but subdued sales” over the next three years, with little movement in median home prices.

Another dismal forecast for British Columbia’s housing market, one day after the Canadian Real Estate Associate predicted home sales will continue to dip in the province next year.

Central One Credit Union, which provides services to more than 300 credit unions across Canada, says in its housing forecast for 2018 to 2021 that B.C. experienced a “mild provincial housing recession” this year.

The report points to the federal government’s mortgage stress test, higher interest rates and various provincial policy measures for the downturn and predicts “rising but subdued sales” over the next three years, with little movement in median home prices.

Bryan Yu, Central 1’s deputy chief economist, says builders have noted the shift and the result is a sharp drop in housing starts since September, especially in urban areas.

He says starts in B.C. are predicted to fall to about 32,000 units in each of the next two years after nearly 40,000 units were under construction this year and 43,500 in 2017.

But the update also predicts positive housing market outlooks in some areas, including Vancouver Island, where retirees fuel the market, and in Northern B.C., where demand is boosted by a liquefied natural gas project and associated pipelines.

Read more: B.C.’s skyrocketing real estate market will ‘correct’ in 2019: analyst

Read more: Vacancies remain low as rents rise in B.C.

As work ramps up on the $40-billion LNG Canada project in and around Kitimat, Central 1 says housing markets in the north are forecast to outperform those in southern B.C., which were hit the hardest this year.

“Sales in B.C.’s combined metro markets of Vancouver, Abbotsford-Mission, Kelowna and Victoria are down 40 per cent compared with the end of 2017, led by the Lower Mainland markets,” Yu says in a news release.

The report shows annual resale home transactions plunged 17 per cent in 2018 and median resale prices slipped two per cent to $520,000.

“Gone are the days of rapid price escalation,” says Yu.

Negative growth in residential investment will drag on the broader B.C. economy, but the Central 1 update says the effect should be blunted by ongoing consumer demand linked to the lowest unemployment rate in Canada, high job vacancy rates, wage gains and population growth.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

There’s still time to stamp your Passport to Christmas

There are 50 Ponoka businesses participating

Photos: 2019 Ponoka CP Holiday Train stop

Featuring Madeline Merlo and Scott Helman

Ponoka Food Bank doubles number of hampers given away last month

Comparing the first two weeks in November in 2018 and 2019

PHOTOS: It’s beginning to look a lot like Christmas …

Winter wonderland of lights: Everywhere you go in Ponoka, people are getting… Continue reading

Ponoka family physician retiring after 40 years of service to community

Dr. Brendan Bunting is hanging up his stethoscope after 40 years as… Continue reading

Fashion Fridays: Ethical and sustainable gifts for the season

Kim XO, helps to keep you looking good on Fashion Fridays on the Black Press Media Network

Man accused in toddler son’s death inept parent, not murderer: defence

Toddler’s body was found outside Good Shepherd Anglican Church in April 2017

Job numbers disappointing, but oil and gas growth expected in 2020: Kenney

Unemployment rate in Alberta rose to 7.2 per cent from 6.7 per cent last month

‘Things haven’t changed enough:’ Ecole Polytechnique anniversary prompts reflection

Fourteen women were fatally shot by a gunman at the Montreal school on Dec. 6, 1989

Feds approve Alberta’s carbon tax on big industrial emitters

Tax will be applied on 10 per cent of emissions produced by the province’s biggest polluters

Appeal denied: Alberta’s top court upholds conviction of triple-murderer

Douglas Garland was convicted of first-degree murder in the deaths of a couple and their grandson

Second warning on romaine lettuce from California region as another E. coli case reported

Two cases of E. coli have been reported in relation to the illness in the U.S.

Many of Canada’s working poor can’t afford lawyers, don’t qualify for legal aid

One lawyer says many people earn too much to qualify for legal aid, but not enough to really live on

Economy lost 71,200 jobs in November, unemployment rate climbs to 5.9%

Jobless rate is at its highest since August 2018, when it hit 6%

Most Read