Morgan Rice

H o u s i n g M a r k e t I n f o r m a t i o n

Housing market intelligence you can count on

C a n a d a M o r t g a g e a n d H o u s i n g C o r p o r a t i o n

BC Region

Fourth Quarter 2009

Resale Housing Market

The resale housing market has

rebounded in recent months and

demand and supply conditions now

favour the home seller. The third

quarter recorded 27,193 home

sales, up 62 per cent from the third

quarter of 2008. The strong surge in

sales during the last five months has

ensured that the number of residential

sales this year has now surpassed the

levels set a year ago.

Supply has also been reduced. Fewer

houses were listed for sale this year;

to date the number of new listings

has declined by roughly 30,000 homes

compared to last year. The increased

competition for housing and lower

level of listings has pushed prices

up. The sales-to-new listings ratio

is currently 69 per cent in British

Columbia (Figure 2).

Lower home prices and low mortgage

rates have been key to the rebound

in the resale market. At the beginning

of the year, an ample supply of homes

for sale and reduced homeownership

demand resulted in lower home

prices across British Columbia. The

fall in home prices coupled with the

historically low interest rates created

a surge of demand that might not

typically be associated with a slowing

economy. The demand came from a

combination of first time home buyers

seizing the opportunity to become

home owners and existing owners

looking to upgrade or move to a

preferred neighbourhood.

More recently, the increased number

of home sales and sellers’ market

conditions has seen housing prices

start to edge up across British

Columbia. On average prices are still

below peak levels.

Economic Developments

Key indicators in the British Columbia

economy suggest a turnaround in the

third quarter. The employment market

has continued to see steady growth in

the number of people working during

the quarter. Growth in the labour

force held the seasonally adjusted

unemployment rate flat at

7.7 per cent, although by September it

had declined to 7.4 per cent, fully one

percentage point below the national

average.

This is the first time since the start

of 2008 that the unemployment rate

hasn’t increased quarter over quarter

and could be a sign that the economy

is starting to turn the corner.

Continued job creation will have a

positive impact on home demand

and also on net migration that has

slipped slightly in recent months.

Positive international migration is

the driving force behind population

growth in British Columbia; it creates

new households which in turn create

housing demand.

The five-year conventional mortgage

interest rate was up marginally this

quarter to 5.7 per cent but remains

well below the 7.1 per cent posted

this time last year. The one- year

rate declined in line with the Bank

of Canada’s commitment of ensuring

low interest rates through the second

quarter of 2010 as long as inflation

remains subdued and in line with the

Bank’s target.

Morgan Rice
Squamish REALTOR®

http://www.morganrice.com
604-849-2668
mrice@macrealty.com