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After approval of the TransCanada Coastal GasLink (“CGL”) pipeline, Fort St. John has experienced a rise in commercial and residential real estate values. As the second biggest city in northern B.C., Fort St. John is a major location for the $40 billion CGL pipeline project which will run 670 kilometres from the northern gas fields to the LNG Canada Terminal at Kitimat.  Canadian Tire has launched an expansion project in Fort St. John for the construction of a multi-phased development with a 154,000-square-foot footprint. Additionally, Fort St. John has doubled the amount of building permits issued since this time last year and the median price of detached residential houses has increased from the previous year.1

Although housing prices in the Vancouver region continue to decline to their lowest level in 27 months, sales of detached homes, condos and townhouses have risen when compared with the same month in 2018.  The sales-to-active-listings ratio reached 16.7 percent in Greater Vancouver in August. According to the Real Estate Board of Greater Vancouver, the recent statistics are evidence of a normalized real estate market. A professor at the University of British Columbia’s Sauder School of Business believes that, although it is too early to be certain, recovery in sales is usually an indication that prices will rebound.2

The downturn in Metro Vancouver’s real estate market has caused developers to cancel or delay housing projects. Some developers are blaming the slowdown on the increase in taxes applicable to real estate in B.C. including property transfer tax for foreign buyers as well as the “speculation tax” levied on second homes in certain regions of the province. However, not all development projects are struggling in the current market. Projects that have experienced success indicate that the solution may be for developers to focus their businesses towards purpose-build rental housing as opposed to condominium developments.3

Finance Minister Carole James believes B.C.’s real estate market is finally experiencing some balance. James states that the B.C. government is “leading the country in our work to ensure that housing is used for people, rather than a haven for speculation or worse, money laundering.” For the first fiscal year of B.C.’s speculation and vacancy tax, the B.C. government expects to receive $115 million from foreign owners, satellite families and those with empty houses.  Others believe there has been nothing but instability in B.C.’s real estate market and the recent decline in prices could lead to catastrophic wealth destruction.4

STATS AT-A-GLANCE

 
BC UNEMPLOYMENT RATES 5
Regions Rate from July 2019 to August 2019 Rate from June 2019 to July 2019
Northern B.C. 9.7% 9.0%
Southern Coastal 6.5% 6.4%
Southern Interior 6.4% 6.3%
Vancouver 4.5% 4.1%
Victoria 4.2% 4.6%

REAL ESTATE ACTIVITY (RESIDENTIAL) BY REGION

Greater Vancouver 6

  • Units sold: 15.7% increase from August 2018
  • Active listings: 13.3% increase from August 2018
  • New listings: 3.5% decrease from August 2018
  • Benchmark price: $993,000 (8.3% decrease from August 2018)*

Victoria7

  • Units sold: 11.3% increase from August 2018
  • Active listings: 12.7% increase from August 2018
  • Benchmark price: $847,300 (4.6% decrease from August 2018 for detached homes)*

Fraser Valley8

  • Units sold: 12.3% increase from August 2018
  • Active listings: 9.6% increase from August 2018
  • New listings: 8.5% decrease from August 2018
  • Benchmark price: $954,100 (5.4% decrease from August 2018 for detached homes)*

Okanagan/Shuswap/Revelstoke9

  • Units sold: 0.75% increase from August 2018
  • Active listings: 4.67% increase from August 2018
  • New listings: 5.57% decrease from August 2018
  • Average residential price: $571,300 (0.54% decrease from August 2018)

Northern BC10

  • Units sold: 7.6% decrease from August 2018
  • Active listings: 7.1% increase August 2018
  • New listings: 3% decrease from August 2018
  • Average residential price: $310,677 (6.4% increase from August 2018)

*Benchmark based on the MLS HPI® benchmark for single family detached homes.

Sources:

  1. https://www.vancourier.com/real-estate/real-estate-affordability-worsened-by-taxes-and-limited-options-say-b-c-residents-1.23841497
  2. https://biv.com/article/2019/05/nearly-90b-equity-wiped-lower-mainland-home-values-past-year-infographic
  3. https://biv.com/article/2019/05/marshmallow-soft-bc-home-sales-fall-11-prices-keep-sliding-forecast
  4. https://www.cbc.ca/news/canada/british-columbia/trans-mountain-bc-appeal-court-1.5148368
  5. https://www.rebgv.org/market-watch/monthly-market-report/july-2019.html
  6. https://www.vreb.org/current-statistics
  7. http://fvreb.bc.ca/statistics/Package201905.pdf
  8. http://fvreb.bc.ca/statistics/Package201908.pdf
  9. https://www.omreb.com/files/06-CO%20Statistics-August%202019.pdf
  10. http://www.bcnreb.bc.ca/creastats

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