CMHC: Lower house sales in lower mainland over next 2 years

The CMHC is predicting declining house sales in the lower mainland over the next couple of years due to higher mortgage interest rates.

“Total housing starts will edge higher as resale market conditions remain balanced and the supply of completed and unabsorbed (unsold) new homes trends lower,” said CMHC B.C. regional economist Carol Frketich.

“Housing demand will be supported by employment and population growth, but tempered by gradually rising mortgage interest rates.”

They are predicting price growth of 1.2 and 1.7% (unclear if this is before or after inflation) and they forecast this based on an assumption of a shift to ‘lower cost housing’.

Which might be good news for anyone trying to sell ‘lower cost housing’ since prices on Vancouver homes under $1.1 million have gone essentially nowhere over the last four years.

 

Sort by:   newest | oldest | most voted
thenonymous
Guest
thenonymous

I’m confused by the statement ““Total housing starts will edge higher as resale market conditions remain balanced and the supply of completed and unabsorbed (unsold) new homes trends lower,”

So more houses will be built as less are sold and thats ‘balanced’? Or am I reading that wrong?

Oh Grow Op!
Guest
Oh Grow Op!

Sounds like they predict homes to barely keep up with inflation?

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@2

AKA a soft landing.

Joe Mainlander
Guest
Joe Mainlander

@#1

They are saying that that they expect housing starts will rise a bit as the as the existing supply of built but not yet sold homes gets absorbed. That sounds like there has been a bit of a glut of new homes on market.

The ‘balance’ comment refers to resale listings vs.sold. They predict that this will remain balanced, therefor not effecting new home absorption. For example, if there were a lot of unsold new product on the market, and also a huge glut of resale listings that were not selling fast (not balanced), that would cause developers to think twice about bringing new product on the market, therefor keeping housing starts low.

Westside Realtard is Romeo Jordan
Guest
Westside Realtard is Romeo Jordan
rocknrolla
Member
rocknrolla

Price appreciation!? Haha, for who? Averages don’t help anyone out because you’re either above or below. CMHC should guarantee a loan for me to lend $500k to someone to take out a mortgage. I would be more than glad to become a bank lender.

Sales down, yes, i see that. Selling your home is the worst emotional drain other than death and health problems.

This guy has got it pegged. Buying a property = pleasure. Selling = pain

http://www.thingsyouwontlearninschool.ca/the-desk/what-do-i-need-to-know-before-investing-in-real-estate

bullwhip29
Guest
bullwhip29
“Which might be good news for anyone trying to sell ‘lower cost housing’….” Doubtful. Anyone trying to sell ‘lower cost housing’ is up $hit creek without a paddle now. New units, which keep sprouting up for reasons beyond comprehension, are being discounted all over the place. Who is supposed to buy all these units? Beats me. Most importantly, why would anyone in their right mind want to pay a similar amount for something a few years older? For that matter, why would someone want to invest any money whatsoever in a much older condo, t/h or apt that either requires tens of $1000’s in upgrades as outlined in a depreciation report or a unit in a strata complex that simply ‘opted out’? For potential sellers with vacant units, I recommend two things: (1) find a nice, reliable long term tenant… Read more »
Oracle
Guest
Oracle

A significant proportion of Canadians are awash in money. I say about 30%.

October has smashed records for new car sales in both Canada and the USA.

No SFD RE correction going to come.

Money talks while Bullshit walks.

valleyrenter
Member
valleyrenter
Lots of new inventory out here for sure. T/H builds sitting for months on end with no love. New condos going up on Whatcom touting “50% sold!”, good luck selling the rest. Guess they figured they would sell out before more commercial development sprouted up in the area, unfortunately not the case as the building is now in between two gas stations, lol. But hey, it’s going to have a pool! Guess you can enjoy the heady fumes of gasoline while working on a tan poolside. Neighbourhood I’ve been watching closely has been steadily dropping in price. Farting around the interweb finding all kinds of neat info on it, specifically T/H prices. Came across old realtor blog entries boasting they sold some at $285,000 back in ’12. Prices now are $239,000-$259,000 asking range, and some are sitting empty, all are… Read more »
tedeastside
Member
tedeastside

hey wheres all the realtors to tell us how awesome vancouvers weather is

proud vancouverites wont like this

http://youtu.be/qZ9weWC3g3c

paulb
Member

New Listings 244
Price Changes 104
Sold Listings 166
TI:14469

http://www.paulboenisch.com

Tiger
Guest
Tiger
CrashComing
Guest
CrashComing

Lower prices year over year in a few months.

And then more and more and.more of the same

All is not good in china.

@westside realtor =crash coming
Guest
@westside realtor =crash coming

Get a job!

CrashComing
Guest
CrashComing

Get a job?

I expect to “make” $50,000 to $100,000 a year, tax free, as RE reverts to mean.

You mean a day job? Ya, I have one of those.

Go buy more Surrey building lots, you chump.

southseacompany
Member
southseacompany

“Poloz Says Raising Rates to Contain Housing Is Bad Idea”, Business week

http://www.businessweek.com/news/2014-11-03/poloz-calls-higher-rates-to-tackle-housing-strain-unattractive

“Higher rates would hurt automakers and construction and confidence in the wider economy, he said, adding “from this monetary policy maker’s perspective, that’s an unattractive alternative.””

“Changes in Canada’s population justify growth in the housing market, and Toronto, Vancouver and Calgary are the only three cities showing signs of overbuilding, Poloz said at a press conference.”

southseacompany
Member
southseacompany

“More to be done on housing risk exposure: Bank of Canada official”, Reuters

http://ca.reuters.com/article/domesticNews/idCAKBN0IO00320141104

“Potential changes needed may include creation of a private-label mortgage securitization market, Bank of Canada deputy governor Lawrence Schembri wrote”

“But since the crisis, Canada’s housing market has boomed as home buyers spurred by record low borrowing costs take on large debt loads.

“These post-crisis imbalances have accelerated a trend in which the government has become more exposed to the Canadian housing market via its guarantees on mortgage insurance and mortgage securitization,” Schembri wrote.

“This trend is not sustainable. The housing finance framework needs to be adjusted and strengthened by rebalancing the risk exposures among the participants in this market.””

“Canadian Finance Minister Joe Oliver said in September the Conservative government wants to reduce government involvement in the mortgage market.”

Westside Realtor
Guest
Westside Realtor

I suspect we will hear talk of changes to cmhc/etc., but little action as this market is losing altitude all across the country now so the politics and also cmhc would be shooting itself in the foot if it accelerated the decline, is that it’s mostly talk…the market is coming down on its own, despite higher sales volumes PRICES ARE FALLING, so this bubble is heading to its logical conclusion despite the lack of intervention.

SFH sales in the upper price ranges on the west side are in peril unless prices are reduced to chase the bid now.

The worm has turned.

Oracle
Guest
Oracle

CMHC says lower sales in the next few years.

I concur. Closing on my new North Delta home tomorrow and will sit on the sidelines for the next decade and watch as Single Family Houses become a less and less percentage of total housing stock.

Time to thoroughly enjoy my new digs!!

And Westside: you’re a Realtor and didn’t invest in it?? Realtors usually get the best deals. What gives ?

patriotz
Member

@16: ““Poloz Says Raising Rates to Contain Housing Is Bad Idea”

He’s right. The problem is government guarantees to lenders which funnel capital into the housing market.

The US has the same interest rates as Canada but 1/2 the RE prices.

@17: “Canadian Finance Minister Joe Oliver said in September the Conservative government wants to reduce government involvement in the mortgage market.”

More talk without the walk. IMHO the recent dive in oil prices means its going to be pedal to the metal for housing until the next election, because there’s nothing else to give the illusion that the economy is doing well.

George
Guest
George
Many Franks
Member

Breaking news! A mortgage salesperson REALLY thinks you should get a mortgage.

Seriously, Why Are You Still Renting In Vancouver?

Ditch Dweller
Guest
Ditch Dweller

Significant flooding in the LM last night. Guess what municipality wasn’t affected. Richmond. Suck it haters.

pati-turncoat-iotz
Guest
pati-turncoat-iotz

He doesn’t want rates to go up because he’s a home owner.

Son of Ponzi
Guest
Son of Ponzi

Ditch Dweller Says:
November 4th, 2014 at 8:43 am 23
Significant flooding in the LM last night. Guess what municipality wasn’t affected. Richmond. Suck it haters.
————
Ditchmond is prepared for the small stuff.
Just not for the big one.
Just a matter of time.

wpDiscuz