Greater Vancouver’s housing market is expected to remain strong this year, despite rumours of a bubble amid soaring prices, says the B.C. Real Estate Association (BCREA).
BCREA said Thursday that multiple listing service residential sales in Vancouver are expected to increase 8.5% to 33,800 in 2011.
The association said strong economic and demographic fundamentals would continue to support local markets.
As well, the average price for a single detached home is expected to peak at $1.15 million in 2011 before clawing back 3.5% to $1.11 million in 2012.
BCREA chief economist Cameron Muir told Business in Vancouver the dramatic increase in housing prices is largely due to a larger proportion of detached home sales in West Vancouver, Vancouver’s west side and Richmond, which are among Canada’s priciest markets.
“What that’s done is skewed that average price number quite high, much higher than market conditions suggest,” said Muir.
He said although the price lift has favoured sellers in the first half of the year, it’s not indicative of the overall price regime when attached and apartment sales are included.
In fact, the BCREA said the typical home price, when all types are included, has climbed a “relatively tame” 5% in the last five months.
The BCREA also said uncertainty around whether the HST will remain in place has temporarily dampened consumer demand.
Muir said that uncertainty has most likely had an impact on new home builds in Vancouver.
“There’s likely been some delays in expensive custom home construction in Vancouver as a result of uncertainty around the HST.”
Joel McKay
Twitter:jmckaybiv