Residential Real Estate - Update
While the number of homes sold in the Kamloops, South and North Thompson region slumped in 2014, the value of the homes sold continued to rise.
British Columbia Real Estate Association (BCREA) predicting a confident picture for our region in 2015... and it's tied to the Commercial Leading Indicator (see below).
Commercial Real Estate Update
The reason for the confidence is well founded. BCREA reports their Commercial Leading Indicator (CLI) remained positive in the fourth quarter of 2014, and that’s not “old news”… it’s a predicator of commercial real estate activity two to four quarters ahead – meaning that the increase in the trend in the last quarter of 2014 predicts positive growth well into 2015.
The news does come with some caution, however. The contribution to growth only came from the economic activity component of the index. Both the financial and employment components posted modest declines from the 3rd to 4th quarter.
The news does come with some caution, however. The contribution to growth only came from the economic activity component of the index. Both the financial and employment components posted modest declines from the third to fourth quarter.
The CLI is impacted from three distinct drivers:
- Economic activity follows the overall trend in the BC economy reflecting economic impact to commercial real estate activity.
- Employment component identifies changes in the commercial real estate environment from changes in the business cycle.
- Financial components are the canary in the mine. An early warning indicator from financial markets may signal shifts in the commercial real estate market.
BCREA Economist Brendon Ogmundson offers this observation, "Rising consumer confidence combined with a lower value of the loonie and a strengthening USA economy helped to push the economic activity component...."