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Housing sales back off from heady days of late 2009

Blog by Shaun Kimmins | June 2nd, 2010

Global economy, effect of HST prompt buyers to bide their time

British Columbia real estate sales dropped by more than one quarter in the three months of 2010 from the last quarter of 2009 in both the number of transactions and value, Landcor Data Corp. reported this week.

The real estate consultants counted 23,195 sales cleared through B.C.'s Land Title office during the first quarter, which is substantially higher than the same period a year ago, but almost 27 per cent off the 31,623 sales recorded during the last three months of 2009.

The total value of those sales almost tipped $10.7 billion, nearly double the number seen during the first quarter of 2009, but again was almost 26 per cent off the $14.4 billion in deals done at the end of 2009.

The results quantify the trend economists such as Cameron Muir, chief economist for the B.C. Real Estate Association, have observed since January.

Landcor's numbers "certainly support the data we've been looking at that shows that obviously the pace of sales have slowed since the last quarter of 2009," Muir said in an interview.

Last year's "fourth-quarter peak is unlikely to reoccur in 2010."

Landcor president Rudy Nielsen said B.C. home sales are typically slow at the beginning of the year, but the first-quarter slowed more than usual compared with the last decade. This is in part, he believes, because of the Olympics.

Nielsen added that consumer uncertainty over a host of issues, ranging from the global economic situation to unknown effects of the harmonized sales tax, have consumers sitting on their wallets.

"I think people are sitting back and seeing where we're going," Nielsen said in an interview.

Muir said he expects higher prices and higher mortgage rates will also squeeze demand.

In it's report, Landcor noted that single-detached houses fared better than condominium and townhouse properties, posting "small yet respectable" gains in average value.

The average house price in B.C., based on all sales recorded through the provincial Land Titles Office, was $487,357 during the first three months of this year, some 2.5 per cent higher than the fourth-quarter of 2009.

Among regions, Landcor found that the Fraser Valley saw the steepest decline in first-quarter sales compared with the end of 2009, and was the region that struggled the most with pricing.

The Valley saw 2,661 sales during the first three months of 2010, down almost 33 per cent from the end of 2009. And while the average house price was up almost two per cent in the first quarter to $445,221, the average condo price was down almost nine per cent to $189,775 compared with the fourth quarter last year.

In Metro Vancouver, first-quarter sales of 11,468 units were down almost 26 per cent compared the last three months of 2009.

The average house price, according to Landcor, was up 1.6 per cent to $721,255 compared with the fourth quarter.

Please contact Shaun directly shaun@shaunkimmins.com to discuss whether it's a good time for you to buy or sell and please feel free to comment on this or any of my other Blogs or visit me at my Century 21 In Town Realty website.