MORTGAGE STRESS TEST CREATING PENT-UP DEMAND
Vancouver, BC – April 15, 2019. The British Columbia Real Estate Association (BCREA) reports that a total of 5,707 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in March, a decline of 23 per cent from the same month last year. The average MLS® residential price in the province was $687,720, a decline of 5.4 per cent from March 2018. Total sales dollar volume was $3.9 billion, a 27.1 per cent decline from the same month last year.
“BC home sales continue to be adversely impacted by federal mortgage policy,” said BCREA Chief Economist Cameron Muir. “The erosion of affordability caused by the B20 stress test has created near recession level housing demand despite the province boasting the lowest unemployment rates in a decade.”
“The sharp erosion of affordability caused by the B20 stress test is now creating pent-up demand, as many would-be home buyers are forced to wait on the sidelines,” added Muir. “Unfortunately, new home construction is slowing as well, which will likely lead to another housing supply crunch down the road.”
Total MLS® residential active listings increased 36.2 per cent to 34,295 units compared to the same month last year. The ratio of sales to active residential listings declined from 29.4 per cent to 16.6 per cent over the same period.