V. Government measures designed to cool residential housing in the Vancouver region will be fully implemented in 2019. year, setting the stage for continued slow sales.
Numerous provincial policies, combined with the federal stress test that made them stronger for borrowers, had already had a major psychological impact on the Vancouver area, Bryan Yu, deputy chief economist at the Central Credit Union, said. The Canadian bank regulator introduced a stress test on January 1, 2018, which made it difficult for customers to qualify for mortgages.
Sales in the Vancouver region fell by 23 percent in 2018, compared with 2017. It is expected that the trend of significantly different expectations between buyers and sellers will be extended in 2019, said Mr. Yu, who predicts that regional sales could drop 0.8 percent in 2019 as compared to 2018.
"We will see a continuous gap between what sellers are willing to sell and what buyers can and will be willing to offer for real estate," he said in an interview. "It comes down to very low sales."
The NDP provincial government will start collecting what it calls speculation tax in 2019. The annual tax is mainly intended for residents outside the province who own real estate in the urban markets of British Columbia. These assets are usually secondary homes or holiday properties that are not leased.
V. The government will also begin to impose an annual surprise involving house owners estimated at more than $ 3 million. The speculation tax and the new surgeon are part of the extensive Housing Policy package that was originally published in ND's budget in February 2018.
Although the crisis of availability is still present, the average prices for detached houses, flats and apartments in the Vancouver region could be reduced by 3 percent in 2019, compared to 2018, forecasts Mr. Yu. It adds that the trend of slowing sales and flat or slightly lower prices could continue until 2020 and 2021.
In August 2016, the former Liberal Democracy government introduced a 15 percent tax on foreign buyers in the Vancouver area, which contributed to the fall in the segregated housing segment in the second half of 2016 and early 2017. market in 2017, the NDP government raised tax on foreign buyers to 20 percent in February 2018 and expanded its tax on other urban markets in the province.
The Vancouver real estate market was faced with "intense pressure" in most of 2018, worsening the rising mortgage rate, senior bank economist Montreal Sal Guatieri said.
"The demand has been so weakened that several customers in the market are now able to get some discounts from retailers," said Royal Bank of Canada economics experts Craig Wright and Robert Hogue.
However, Mr. Yu said that the economy of British Columbia will remain strong over the next three years, while the unemployment rate should remain relatively low and no signs of global financial shock.
"Domestic prices are eroding but will not collapse," he said. "We have hit a very weak point in the housing sector, and this is a policy-driven event. The labor market is strong, not in an economic recession or in a crisis of confidence."
The average price for family houses sold on the west side of Vancouver reached $ 3,218,333 in November 2017. The median of separate prices has fallen by 11 percent since then, but is still unavailable for most potential customers at $ 2,860,000.
The housing and housing market showed signs of resistance at the beginning of 2018, although it has been significantly alleviated in recent months. The price of apartments sold in Greater Vancouver in November was $ 690,190, an average of 7.7 percent less than in April.
But even the initial flats remain too expensive for many customers who bought it for the first time, said Paul Kershaw, founder of Generation Squeeze, a lobby group that featured Canadian views in the 40s and younger. "Property prospects in younger demographic populations have been more damaged in British Columbia than in any other province," he said.
The rapid rise in real estate prices from mid-2013 to mid-2016 in Vancouver encouraged many residents to move to other parts of the province, helping to raise prices in markets such as Victoria and Sunshine Coast, said Mr. Kershaw.
Generation Squeeze's analysis showed that the rate of ownership of British Columbia homes for residents between 35 and 44 was 67 percent in 2016, compared to 78 percent in 1977.
"We have successfully experienced the earthquake in the real estate sector of BC," said Mr. Kershaw. "It's not just a question in Vancouver because it has spread to suburbs over the past decade, and has gone to other urban centers like Victoria. Even if you save enough for the advance, the hard work does not pay as it once did."