B.C. home sales lifted in April, but experts say the market has begun to show signs of leveling off.
According to the British Columbia Real Estate Association (BCREA), the province’s residential home sales climbed 21% to 8,385 units in April compared to the same time last year.
Yet, on a seasonally adjusted basis, residential sales dropped 4% from March, and sales trends have lowered to between 84,000 and 86,000 units over the past three months, which is down from the 108,000 unit pace in the fourth quarter of 2009.
BCREA chief economist Cameron Muir told BIV it’s a sign the market has slowed down after a post-recession spike in sales.
“You can see the trough and the gigantic rebound and things have settled off about 20% to 25% since the beginning of the year, and that’s really a reflection of pent-up demand that’s been expended in the marketplace,” said Muir.
He also said higher prices, interest rates and tighter credit have eroded affordability on the coast.
“Markets such as Vancouver and Victoria have seen significant price appreciation over the last half of last year and the first quarter of this year, and as a result we’re back in a market where affordability is the most critical impediment for home ownership,” Muir said.
Residential sales volume in B.C. increased 73% to $13.5 billion in the first four months of 2010 when compared with the same period in 2009.
But the real estate market in Vancouver and Victoria is seeing more balanced conditions over the last few months, Muir said, and that means less upward pressure on prices for the remainder of the year.
“We’re not expecting to see record levels of home sale this year, and going forward home prices are going to remain relatively flat for the rest of the year.”