B.C. housing market to remain vibrant through the new year: report
Vancouver's skyline at sunrise is shown in this undated handout photo. Vancouver has been placed on travel site Lonely Planet's top ten list of cities to visit in 2020. (Destination BC/Albert Normandin via The Canadian Press)
VANCOUVER -- A company that supports hundreds of credit unions across Canada predicts British Columbia's housing market will remain healthy through 2021 as the province moves out of its COVID-19 slump.
A report from Central 1, the organization that handles financial services, digital banking and other resources for more than 250 credit unions, says B.C. has seen a “spectacular” rebound in housing demand since pandemic-induced lows in the spring.
The report says affordability remains a focus, as median home prices are up nine per cent this year to $585,000 and are forecast to climb a further six per cent to $618,000 in 2021.
It says the number of homes sold in B.C. leaped 20 per cent this year, overcoming the pandemic downturn, and up to 95,000 properties could change hands next year, nudging market highs set in 2017.
It credits the surge to “unique characteristics” of pandemic economics, ongoing low interest rates and higher-paid workers remaining relatively unscathed from the worst of the COVID-19 contractions.
The report also forecasts a firmer rental market through 2022 as economic conditions normalize, border restrictions ease and post-secondary institutions reopen.
But it says rents shouldn't budge much over the coming year, while a provincially imposed rent freeze is in effect.
Brian Yu, Central 1 deputy chief economist, authored the report and calls B.C.'s ongoing pandemic recovery a “mix of short-term challenges and future optimism.”
“Economic growth is forecast to pick up steam in the second quarter of 2021 onwards as the vaccine drives higher investment spending and consumer spending is unleashed when social and travel restrictions are eased,” Yu writes.
Some job loss will continue in B.C.'s “fragile sectors,” Yu says.
Even though employment remains 1.5 per cent lower than it did in February, he says the province is outperforming most others and sectors such as retail spending, manufacturing, and exports are “largely recovered.”
This report by The Canadian Press was first published Dec. 21, 2020.