Around mid-January this year, Brendon Ogmundson wrote that the 2021 housing market in the province is expected to “get off to a roaring start”.
Ogmundson is the chief economist of the B.C. Real Estate Association, and he was recapping the 2020 market at the time.
As many know, 2020 was an unprecedented year for real estate, as sales and prices skyrocketed amid the COVID-19 pandemic.
“We expect considerable momentum heading into 2021,” Ogmundson stated then.
Then March 2021 came around, and shattered the all-time high record for monthly sales in the province that was set in May 2016.
However, in the following months from April to July this year, the number of sales has dwindled.
But here’s a surprise: 2021 may outperform 2020 in both sales and prices.
A new and third quarter housing forecast by the BCREA predicts that home sales will total 118,350 in 2021.
If realized, this number will mark a 25.9 percent increase from the 94,007 sales last year.
The average price of a B.C. home is also anticipated to post a double-digit annual increase.
The BCREA forecast that the average price in 2021 will climb to $911,300, for a 16.6 percent increase over $781,561 last year.
“The pace of home sales in the province has slowed in recent months but an unprecedented start to the year still has BC on track for a record-breaking year,” Ogmundson stated in the housing forecast released Thursday (August 19).
The forecast acknowledged that an “expected second-half slowdown has arrived”.
The slowdown is due to “eroding affordability and a tightening of mortgage qualification rules”.
“However, with the BC economy on track for very strong growth this year and next, along with the eventual return of normal migration flows, home sales are anticipated to remain well above long-run average levels into 2022,” the forecast stated.
Meanwhile, the low supply of homes for sale will continue to keep prices up.
“Even if sales come back down to long-run average levels, total listings would need to nearly double to bring markets back into balance,” the BCREA forecast noted.