Modest price drops and tempered buyer expectations are expected to stir up some movement in B.C.’s stagnating real estate market this year, according to an industry forecast released Wednesday.
In its first quarter housing market forecast released Wednesday, the B.C. Real Estate Association (BCREA) says housing sales in B.C. on the Multiple Listing Service (MLS) are expected to pick up by 5.6 per cent in 2013.
It wouldn’t be enough to make up for the 12 per cent sales drop seen across B.C. in 2012 but would at least mean buyers will be getting off the sidelines and jumping into the market again.
The slight jump in sales predicted this year is expected to add up to just over 71,000 properties sold across the province.
Next year, the association is expecting prices will climb about another six per cent.
Greater income stability, including more part-time jobs being converted into full-time positions last year, is seen as being a factor in the increased sales.
The BCREA expects the average MLS listing in B.C. to edge down nearly one per cent to $510,400 this year, and edge up 0.6 per cent in 2014.
The association says pricing is also a factor in the sales boost, but mostly because prices haven’t been dropping much and some buyers just may give up on the waiting game.
Cameron Muir attributes it to a change in the overall consumer psyche, suggesting that it’s not a case of the bubble bursting, but people’s expectations becoming more realistic.
“[Buyers are] expecting to see a deflationary spiral in the real estate market and they’re waiting to buy in to that proverbial 50 cents on the dollar,” he told CTV News.
“I think what’s going to happen is in the next few months is some of those buyers that have been sitting on the fence are saying those prices aren’t falling the way they thought they were going to fall.”
In Vancouver, the association anticipates a housing sales boost of close to 10 per cent for the year. That follows a whopping 23 per cent decline in 2012.
Realtor Laura-Leah Shaw, who’s sold real estate in Vancouver for 25 years, said some people took their listings off the market last year because sales were slow and “people just needed to take a breath.”
But Shaw says the outlook for 2013 is much more optimistic and she’s being contacted by lots of potential buyers.
“People are happy, the phones are ringing. It feels like people are back and ready to buy real estate.”
The BCREA makes its predictions based on a number of economic factors, including domestic and international markets, population growth -- including immigration and inter-provincial migration -- household growth, interest rates, employment rates and domestic consumption. It also looks at housing starts and completions in the province.
The British Columbia Real Estate Association (BCREA) represents 11 member real estate boards and their approximately 18,000 realtors.
