It was an increasingly difficult year for home buyers and sellers in British Columbia.
A recent report from the British Columbia Real Estate Association (BCREA) is showing that sales in BC’s housing market dropped by 25% in 2018.
The Multiple Listing Service (MLS) recorded a total of 78,345 residential unit sales over the past year, a sizeable drop from the 103,758 units that were sold in 2017.
Last year’s home sales also fell below the 10-year-average of 84,000 units.
The report notes, however, that although sales fell below the average, there was certainly no shortage in listings. Active residential listings increased by 33.3% in December 2018, meaning that there were a total of 27,615 homes up for sale.
That’s the highest December inventory that the province has seen since 2014 when close to 34,000 homes were listed for sale.
Home prices, however, were also on the rise. Although the report only shows a provincial price increase of 0.4%, inspecting the year-to-year change by region paints a much different picture.
Chilliwack and the Fraser Valley saw the average price of homes increase by as much as 11.2%. Both Vancouver and Victoria saw prices increase by 7.3% and 7.9%, respectively.
The only regions that saw minimal change in the average annual price were Greater Vancouver increasing by 1.5% and the Northern lights, which increased by the same amount.
Cameron Muir, BCREA Chief Economist, blames the notable decrease in consumer demand over affordability issues caused by the newly-mandated B20 mortgage stress test.
New mortgage rules introduced in 2018 made potential buyers undergo a “stress test” to prove they would be able to still make mortgage payments even if the interest rate was to rise substantially.
The BCREA is a professional association that works with the province’s 11 real estate boards and approximately 23,000 realtors in BC.