Housing Market Faces a Challenging 2023 Before Posting a Strong Recovery in 2024
BRITISH COLUMBIA – The British Columbia Real Estate Association (BCREA) released its 2023 First Quarter Housing Forecast Update today.
Multiple Listing Service (MLS) residential sales in BC are forecast to decline 7.1 per cent to 75,150 units this year. In 2024, MLS residential sales are forecast to post a strong rebound, rising 23.8 per cent to 93,025 units.
“A slowing economy and still elevated mortgage rates are expected to keep housing activity lower than normal through much of 2023,” said BCREA Chief Economist Brendon Ogmundson. “However, we expect a strong recovery, boosted by an expected decline in mortgage rates and record high immigration that will carry significant momentum into 2024.”
Inventories have increased from the depleted level at the beginning of 2022, but they remain low compared to historical levels, despite a sharp decrease in sales. However, the abrupt shift in market conditions has meant that prices have come down despite low inventory, falling from peak levels through the spring before stabilizing toward the end of last year.
While we expect MLS® average prices to trend relatively flat this year, they will be lower than the peak values of 2022. Consequently, year-over-year comparisons will register negative for much of 2023, likely resulting in negative annual price growth even if monthly prices begin to recover as expected later this year.
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