The Canadian Mortgage and Housing Corporation has lowered it’s forecast for housing starts and prices in BC due to the weak economy. They are predicting a 43% decline in housing starts this year, and more than 15% decline in house prices over the next two years.
Canada Mortgage and Housing is forecasting the average Metro Vancouver home price to decline 13 per cent in 2009, and a further 2.3 per cent in 2010.
“Buyers’ market conditions that began in mid 2008 will persist through this year before supply and demand conditions become more balanced in 2010,” Canada Mortgage and Housing said in its forecast.
The housing agency expects the decline in sales will flatten out later in 2009 as first-time-buyers are lured back into the market by lower prices, but “[s]lower economic growth will keep demand for home ownership sluggish through early next year.”
In another report, the research firm Landcor Data Corp. noted that real estate sales recorded through the B.C. Land Title Office dropped to their lowest level since 1985 in the first quarter of 2009.
However, Landcor president Rudy Nielsen said the recent trend of rising sales over the past few months could be signaling that the downturn is near its bottom and represent “a light at the end of the tunnel.”
Or, the blip in sales “could be a grizzly bear with a flashlight. It’s tough to guess right now where the hell we’re heading,” Nielsen said in an interview.
If you’re counting on lower house prices to make Vancouver more affordable does the recent blip in sales have you concerned? Is this a market recovery, a spring bounce or a grizzly bear with a flashlight?