SUMMARY

The Canadian job market reversed some of its losses from November, gaining 35,200 jobs in December. Overall, the Canadian economy added 320,000 jobs in 2019, including 282,800 full time jobs and 37,500 part time jobs. Experts say this confirms the Bank of Canada’s current policy stance that the economy remains resilient making further interest rate cuts unnecessary, and they predict the Bank of Canada will hold its interest rate steady at 1.75%. Assessment BC has released its 2020 property assessments, with many houses across Metro Vancouver seeing double-digit drops in value. Property values in the rest of BC remained generally stable, rising or falling by around 5%, except in Kitimat and Terrace which saw rises nearing 40% due to the new LNG Canada export facility. Though property values have dropped in Metro Vancouver, December housing sales in the region increased by 88.1% over last year. And while the volume of sales has increased in Metro Vancouver, sale prices remain slightly depressed with most experts expecting lower prices to remain in place for the rest of 2020 before recovering in 2021.

IN THE NEWS

The Canadian job market bounced back in December, posting a gain of 35,200 jobs and reversing some of the losses from November. Full time employment rose by 38,400 jobs, while the number of part time jobs fell by 3,200. Sherry Cooper, chief economist at Dominion Lending Centres, said the December employment report confirms the Bank of Canada’s current policy stance that the economy remains relatively resilient, so further interest rate cuts are unnecessary. Ms. Cooper predicts that the central bank is likely to keep its key interest rate on hold at 1.75%. Overall, the Canadian economy added 320,000 jobs in 2019, including 282,800 full time jobs and 37,500 part time jobs.1

According to Assessment BC, the provincial agency which annually appraises all properties in the province, residential property values across Metro Vancouver decreased by up to 15.9%. The value of detached homes in Vancouver decreased by 11%, in Surrey by 3%, in Burnaby by 10%, and in Richmond by 14%. Provincial Housing Minister Selina Robinson called the decreasing property values a positive sign that the government’s efforts to increase housing affordability was having a real impact. In the rest of BC prices were generally stable, rising or falling between 5%. The two exceptions, Kitimat and Terrace, saw property values increase by nearly 40% due to construction of the new LNG Canada export facility.2

In what may be an encouraging sign to homeowners concerned about the dip in the assessed values of their properties, the Real Estate Board of Greater Vancouver reported that December sales were up 88.1% over last year, and 9.5% above the 10-year average. However, while sales for the entire year were up by a thin 3.2% over 2018, they were will down 7.6% from the 10-year average. Prices also dipped between 2% and 4% across the region last year, while inventory is down 16.3% from December 2018. But after a series of month-to-month declines, prices began to edge slowly up in the fall. Analysts with both Central 1 Credit Union and the Canadian Mortgage and Housing Corporation have predicted that the market will stabilize in 2020, with price increases beginning again in 2021.3

2019 was a whirlwind year for BC’s real estate market, and the 2020 forecast is decidedly cloudy. Some factors, including steady employment and population growth, along with low mortgage rates, indicate that the recovery seen at the end of 2019 could persist to help ensure a robust housing market. However, there are signs that the market is slowing, mostly due to a pullback of foreign investment, policy changes, and indebted households with wages that haven’t kept pace with home prices. There is also a record number of new housing units nearing completion and near-record totals for units under construction which means the housing market is about to see a ton of new product. Depending on the state of the labour market, this will either keep housing prices low or push them down if unemployment and tighter credit weaken housing demand. Therefore, the odds of housing prices rising next year remain low.4

STATS AT-A-GLANCE

BC UNEMPLOYMENT RATES 5
Regions Rate from Dec 2019 to Jan 2020
 Rate from Nov 2019 to Dec 2019
Northern B.C. 10.5% 10.6%
Southern Coastal 7.1% 6.8%
Southern Interior 6.2% 6.2%
Vancouver 4.9% 5.0%
Victoria 4.3% 4.5%

REAL ESTATE ACTIVITY (RESIDENTIAL) BY REGION

Greater Vancouver 6

  • Units sold: 88.1% increase from December 2018
  • Active listings: 16.3% decrease from December 2018
  • New listings: 12.9% increase from December 2018
  • Benchmark price: $1,001,000.00 (3.1% decrease from December 2018)*

Victoria7

  • Units sold: 7.2% increase from December 2018
  • Active listings: 1.8% decrease from December 2018
  • Benchmark price: $855,000.00 (0.6% decrease from November, 2018 for detached homes)*

Fraser Valley8

  • Units sold: 55.9% increase from December 2018
  • Active listings: 14.1% decrease from December 2018
  • New listings: 3.1% decrease from December 2018
  • Benchmark price: $953,700.00 (1.2% decrease from December, 2018 for detached homes)*

Okanagan/Shuswap/Revelstoke9

  • Units sold: 26.76% increase from December 2018
  • Active listings: 2.12% decrease from December 2018
  • New listings: 10.52% increase from December 2018
  • Average residential price: $556,127.00 (4.39% increase from December 2018)

Northern BC10

  • Units sold: 18.8% decrease from December 2018
  • Active listings: 2.2% increase December 2018
  • New listings: 20% decrease from December 2018
  • Average residential price: $348,779.00 (18.8% increase from December 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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