This article appeared on the CanadianRealEstateMagazine.ca on August 12th, 2011.
British Columbia suffered a major dip in home sales during July, but the situation could get better if interest rates drop, according to a new report by the British Columbia Real Estate Association (BCREA).
Sales were up 12.9% in July compared to a year ago, while average prices were up 10% over the same period. But even with adjusting for the typical drop in July activity, seasonally-adjusted sales are trending down in the province.
BCREA said seasonally adjusted sale fell 4% in July from June. The raw numbers pointed to larger downward trend, with sales dropping 17% to 6,533 in July from 7,904 sales in June
Rising prices in the province might be putting off interest from potential buyers, however. The average price is now $540,877, according to the BCREA’s report on July stats.
“Less frenetic activity in Vancouver operated to pull total provincial sales lower,” said BCREA Chief Economist Cameron Muir.
Recent global financial uncertainty, especially in the U.S., could help pull mortgage rates in Canada even lower, however, spurring another surge in sales, Muir said.
“The increased affordability and added purchasing power from lower mortgage rates will help bolster housing demand,” he said.
While the average residential price in Greater Vancouver is now $761,763 and 15.8% higher than a year ago, the rest of the province showed more modest results.
Prices are up 9.7% in Fraser Valley to $503,931, and up just 0.5% in Okanagan Mainline to an average of $408,035.
B.C. Northern was the most affordable location last year with an average price of $211,542, but that’s now up 7% to reach $226,359.
In Northern Lights, where the average was $239,955 last year, it’s now the province’s lowest after dropping 8.3% to reach $220,060. Kamloops also dropped 7.6% since last year to reach an average in July of $287,005.