BC Economy And Housing Growth Forecast

March 7, 2010

A five-year economic forecast by Chief Economist, Helmut Pastrick”, Central 1 Credit Union, covering 2010-14 pointed out that:

“B.C.’s economy is growing again with the help of record low interest rates and improvements in the world’s financial conditions, commodity markets and economy.”

“Faster growth after 2011 is centred in the domestic economy, and private investment in particular, assisted by more residential housing and consumer activity”.

“Housing starts are forecast to jump more than 50 per cent this year from 2009’s deep bottom, climbing to more than 30,000 units in 2012 and almost 40,000 units in 2014. Some home building is being brought forward before the HST comes into effect on July1 this year”.

condoproject.jpgHousing sales and price growth

There are factors that may tamper housing price increase in the second half or 2010. If supply of resale homes and new homes increase at current pace, with slowing down in demand, stabilization in home prices can be expected. Current list/sale ratio is improving and moving towards a more balanced housing market.

BC’s economy is dependant on the general health of the export sector and domestic demand for housing can take a turn if consumer confidence is affected by adverse economic news. High home prices have resulted in severely un-affordable housing.

The supply and demand for housing the next few months will give provide a clearer direction on how the BC housing industry will fare in the next 2 to 3 years.

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