The number of multiple-listing-service residential sales has taken a nosedive this year across the province.
According to the B.C. Real Estate Association, the number of transactions is expected to drop by 23 percent by the end of the year compared to 2017.
The BCREA expects about 80,000 sales in 2018. That compares to a 10-year average of 84,000, but would still be down significantly from the 103,768 residential sales recorded last year.
“The marked erosion of affordability and purchasing power caused by the mortgage stress test and rising interest rates continue to be a drag on the housing demand,” BCREA chief economist Cameron Muir said in a news release. “However, continuing strong performance in the economy combined with favourable demographics is expected to push home sales above their 10-year average in 2019.”
The decline in housing sales has occurred while B.C.'s unemployment rate has been at a 40-year low.
A report on the BCREA website likens slowing demand to what occurred in 2012 when former federal finance minister Jim Flaherty reduced the amortization rate to 25 percent on residential mortgages.
It's occurring in the midst of a home-building boom in the Lower Mainland.
"There are nearly 44,000 units under construction in Metro Vancouver, 60 per cent above the previous peak of 27,000 units recorded in 2008," the report states.
That's on top of a predicted 24,000 housing starts in each of 2018 and 2019.
"Millennials' demand for urban rental and condominium homes is expected to remain strong over the next several years," the report notes, "while retirement-friendly markets are expected to be pressured by boomers with cashed-out equity to spend."
The BCREA has upped its annual forecast for growth in B.C.'s gross domestic product from 2.5 percent to 2.9 percent in 2019.
That's due in part to LNG Canada giving the green light to a $40-billion investment in a new plant in the Kitimat area and an associated pipeline.