Predictions 2021: Demand for housing will remain high in Metro Vancouver
Colette Gerber describes herself as a numbers person.
Understanding figures comes easily for her. Before becoming a realtor in 2008, she worked for a long time in management and finance.
Amid a public health crisis unleashed by the coronavirus, Gerber, on May 8, 2020, started her term as chair of the Real Estate Board of Greater Vancouver (REBGV).
“I am always looking at economic data from different sources,” she said in a phone interview.
The Straight sought Gerber out on what to expect in the residential property market in 2021.
“There’s still demand out there,” she said.
And this means that next year’s market will remain busy, although, she added, probably not as frenetic as 2020.
The REBGV chair noted that as of the end of November, year-to-date sales have exceeded the whole of 2019.
This signals that 2020 is on track to become a record year.
Strong sales continued since the start of December, and, according to Gerber, this is a good sign for 2021.
A December 14, 2020, report by Vancouver-based Dexter Realty indicates that home and land sales in REBGV areas for the month as of that day reached 1,492.
The number brings year-to-date sales from January to December 14, 2020, to 29,946. The whole year’s total in 2019 was 25,681. In 2018, it was 25,051.
In the report, Kevin Skipworth, partner and chief economist with Dexter Realty, noted that “optimism continues to grow with a vaccine now in use”.
“The struggle with COVID-19 continues, though, and with more isolation at home required to get us through, once again our home has never been so important to us,” Skipworth wrote.
In a fourth-quarter forecast released last November, the B.C. Real Estate Association noted that record-low mortgage rates and a recovering economy are expected to drive sales in 2021.
The BCREA also anticipates “strong momentum” heading into the new year.
According to its forecast, home sales across B.C. are expected to increase 16.9 percent, to 90,450 units, in 2020, surpassing the 77,350 deals in 2019.
Moreover, residential sales in 2021 are predicted to increase 9.7 percent, to 99,240 units.
The BCREA also forecasts “more normal, though still robust levels” for the Lower Mainland–Southwest region of the province.
The region is serviced by the REBGV, Fraser Valley Real Estate Board, and the Chilliwack and District Real Estate Board.
“Without a sharp rise in inventory, there will be sustained upward pressure on home prices over the next year,” the BCREA noted.
The association expects average home prices in 2020 to finish 7.4 percent higher than 2019 in Greater Vancouver, and a further 1.4 percent increase in 2021.
In the Fraser Valley, the BCREA sees average prices rising 9.5 percent in 2020 and 1.3 percent in 2021.
Meanwhile, average 2020 prices in the Chilliwack area are anticipated to increase 8.1 percent over 2019 and a further 2.5 percent in 2021.
In the phone interview, REBGV’s Gerber told the Straight that the housing market for all categories was in sellers’ territory in November, and that situation held moving into December.
This likely indicates further price gains in 2021.
“Moving into next year, some categories, perhaps condos, may be a little more stable in their pricing,” Gerber said. “But townhouses, which there aren’t enough in the Lower Mainland, and single-family homes, I still think there’ll be modest price increases in those areas.”
Meanwhile, the Bank of Canada on December 9 maintained its mortgage-setting key interest rate at the lowest level of 0.25 percent.
The central bank slashed rates down to this level on March 27, 2020, to ward off the economic effects of the COVID-19 pandemic.
In a statement, the bank reiterated its October 2020 projection that it is likely keeping that rate until 2023.
Additionally, a poll by RBC captured one factor that likely will boost the property market in 2021.
According to the results of a bank survey released on December 3, a third of respondents (31 percent) indicated that they are willing to help an adult child or immediate family member to pay for a home purchase.
The poll showed that these respondents were ready to provide an average of $60,513 in financial assistance.
Moreover, fewer than half of them expect to be paid back.
“Even during these uncertain times,” Amit Sahasrabudhe, an RBC vice president, noted in a media release, “what we are seeing is that families are continuing to rally around each other and financially support their loved ones as they work towards buying a home.”
Source from: https://www.straight.com/news/predictions-2021-demand-for-housing-will-remain-high-in-metro-vancouver