The housing market in British Columbia is benefitting from a cocktail of positive influences which are aiding its recovery.
The deputy chief economist of Central 1 Credit Union says that the rebound is happening faster than expected as lower mortgage rates, the first-time homebuyer incentive, and international immigration give the market a helping hand.
In his latest outlook, Bryan Yu says that these factors are driving buyer demand and affordability for the province’s housing market, with sales higher than last year in 7 of the 8 months since February.
Lower prices in urban centres, coupled with more favourable mortgage rates have been supported by the strong labour market.
However, despite improvement, homes are still out of reach for many would-be homebuyers, due to government policy that constrains supply says Yu.
This may be temporary, but for now he sees increased rental demand, with low vacancy rates boosting rental rates.
And the lower buyer demand seen in the past two years is likely to lead to constraint of affordable homes as Central 1 anticipates and undersupply of construction in response to the previous weakness.