The second half of 2023 and the first part of 2024 included moderation from the Federal Reserve Board with respect to interest rates. The effects of the interest rate run-up continue to be felt, however. Recent moderation in rates and indications that rates may be lowered in the near future have boosted activity in many markets, although values remain flat. Office building markets, in many areas in particular, continue to be plagued by rent shrinkage, lower occupancies and mortgage defaults caused by the expiration of long-time lower interest rate mortgages.
Last month in British Columbia, there were 8,075 residential sales, 11.6 per cent less than the same time last year, according to the British Columbia Real Estate Association (BCREA).
Average price and total sales
B.C.’s average listing price in May was down to $1 million, a 1.5 per cent drop compared to the average price of $1.02 million in May 2023. As well, total sales dollar volume was down in the same period by 13 per cent, to $8.1 billion.
“Markets could not match the surge in home sales that occurred this time last year,” says BCREA chief economist Brendon Ogmundson. “However, we are starting to see a pickup in sales activity to more normal levels, which, combined with rising inventory, is helping to keep markets in balanced territory.”
Year-to-date
So far this year, B.C. residential sales dollar volume is up 2.7 per cent to $31.5 billion, compared with the same time in 2023. Residential unit sales were flat year-over-year at 31,573 units, and the average listing price was up 2.6 per cent to $997,899.
Lenders want to resolve and move on from legacy default issues. New investors are looking for opportunities. Owners, brokers and counsel should be prepared to work together to achieve results such that all sides live to fight another day.