The recently released Housing Market Overview from RE/MAX shows that Vancouver was tied with Kelowna for total sales growth for 2013. Both B.C. markets saw home sales increase by 10 per cent.
But despite the good news about home sales, Vancouver still remains as one of Canada’s priciest cities. This is the direct result of several key factors.
“The location and amount of immigration the city gets have always kept Vancouver among the highest-priced markets historically,” explains Robert Kavcic, Senior Economist and Vice President of Economic Research with BMO Capital Markets.
Vancouver’s average home price is currently $765,000, an amount that Kavcic expects will decrease slightly in the New Year.
“We are actually expecting a pretty modest decline in prices over the next two years,” he says. “As mortgage rates gradually rise, we believe there will be a bit of a correction. I would suspect that the correction would be less than 10 per cent.”
Although the market is projected to soften in 2014, Kavcic believes that Vancouver will not be as hard hit as most think.
“It will probably be quite a bit softer than we’ve seen in recent years, but it will be a bit more balanced than what we saw throughout much of 2013,” says Kavcic.
“Last July, we saw a pretty deep buyers’ market in Vancouver for a good six months through the turn of the year,” he adds. “The market is more balanced now, so I suspect it will be a slightly stable downward-trending market as mortgage rates start to back up a bit.”
