Cooling off forecast in real estate sector
Written by Citizen staff
Tuesday, 06 May 2008
In a forecast released Tuesday, the BCREB predicted the average price for a single-family home in the city will increase by three per cent during each of the next two years, to $248,000 and $256,000, respectively, compared to a 22-per-cent jump to $240,442 experienced in 2007.
Moreover, the number of units sold is expected to continue to decline, by 13 per cent to 950 sales in 2008 and five per cent to 900 in 2009, following a drop of nine per cent to 1,092 in 2007.
Multiply the average price by the units sold and the market for single family homes is predicted to drop by 10 per cent to $235 million in 2008 from $263 million in 2007 and to fall a further two per cent to $230 million in 2009.
Meanwhile, housing starts are forecast to drop five per cent over 2008 to 310 from 328 last year, when the total was up by three per cent. And over 2009, starts are expected to fall a further two per cent to 305.
Broken down further, starts on single-family homes are expected to fall by six per cent, to 270, from 288 in 2007, when the total rose by two per cent. And in 2009, the total is expected to fall a further four per cent to 260.
For multi-family units, starts are expected to remain the same in for 2008 at 40 and then rise to 45 in 2009, a 13-per-cent hike.
Prince George won't be the only community facing a slowdown -- the BCREA is predicting a provincewide moderation.
“Some weakness on the export side of the economy and eroding affordability will have an impact on housing demand over the next two years,” said BCREA chief economist Cameron Muir.
But he added that while the weak U.S. economy is negatively impacting the forest industry and tourism, "the B.C. economy is forecast to grow 2.5 per cent this year and 2.7 per cent in 2009, a higher rate of growth than most other provinces.
"Consumer spending, employment growth and net migration in the province are expected to remain robust and will continue to underpin housing demand through 2009," Muir said.
Housing starts down in April, according to CMHC
Written by Citizen Staff
Thursday, 08 May 2008
Starts on construction of new single detached homes in Prince George declined last month in comparison with the same month a year ago, according to the latest release from the Canada Mortgage and Housing Corporation (CMHC).
In April there were 16 starts on new single-family homes, down 20 per cent from the 20 recorded in April 2007, CMHC statistics show.
Year-to-date figures are also down.
Between Jan. 1 and April 30 of this year work began on a total of 44 single detached homes, down 33.3 per cent from 66 starts on single-family homes during the same four months of 2007.
Housing values up 84% from 2003
Written by PAUL STRICKLAND
Citizen staff
Thursday, 24 April 2008
Prince George weakest performer in real estate survey
The average house price in the Prince George region has increased 84 per cent since 2003, according to a study by the B.C. Northern Real Estate Board.
However, owning a home in the North still consumes a much smaller percentage of household income than Vancouver, according to the fifth annual Housing Affordability Study released Wednesday.
The average price of a home in this city declined from just under $150,000 at the end of 1997 to around $120,000 in 2001 and then soared to just under $250,000 at the end of 2007.
The BCNREB commissioned the affordability study after RBC Financial Group released the results of its cross-Canada housing affordability study. The latter study showed B.C. was the least affordable place to buy a house in the country. However, the BCNREB finds that the costs in northern B.C. are about 31.7 per cent of family income compared to an average of 68.5 per cent for the entire province.
One way to determine the portion of an average income required to purchase a home in different regions is to refer to the housing affordability index. The index estimates the portion of pre-tax median household income needed to cover mortgage costs, municipal taxes and fees and utilities for single-family homes. For 2007 the Housing Affordability Index for northern B.C. was 31.7 per cent compared with 73.8 per cent for Vancouver.
There are considerable variations with the region. The housing affordability index for Kitimat is just 15.4 per cent, while home ownership in 100 Mile House consumes the highest proportion of of median household income, 51.8 per cent, of all the communities in the northern two-thirds of the province served by the BCNREB.
Prince George weakest performer in real estate survey
Written by MARK NIELSENCitizen staff
Wednesday, 30 April 2008
Prince George is the weak spot in a major realtor's semi-annual survey of real estate prices.
Century 21's 2008 spring national house price survey, released Wednesday, showed the price of a typical bungalow in lower College Heights dipping two per cent year over year to $219,900, showed no change for a townhouse in the Valleyview subdivision at $190,000, and a scant two-per-cent increase to $266,900 for a two-story house in the Heritage subdivision.
Almost every one of the other 21 subdivisions in the survey representing communities across B.C. showed significantly stronger increases.
The numbers clash somewhat with those from the B.C. Northern Real Estate Board for the first quarter of 2008. They show the average price of a single family home for Prince George as a whole at $246,839, up about six per cent from the typical price over the same period last year.
However, Prince George real estate agents sold 193 single-detached houses over that period, down from the 243 in 2007.
Prince George real estate agent Gary Shannon, a director on the BCNREB, conceded that the market is softening because of the forestry slowdown following an upward trend that has seen the average house price rise 84 per cent since 2003.
"We're not going to see some tremendous rises this year I don't think," he said.
However, he believes stronger growth should return within the next 18 months to two years.
By then, Shannon predicts cargo jets will be landing at the Prince George Airport -- the runway extension and fuel apron are scheduled for completion in October -- the container terminal at Prince Rupert will be taking on more work and hopefully the ongoing mineral exploration will be translating into some new mines.
"These things don't happen overnight, they take a little bit of time," he said.
In contrast to previous forestry downturns, Shannon said this one hasn't struck the city as hard.
"The forest industry is still important but it's not having near the impact it had 10 or 15 years ago," he said. "There are too many other things offsetting the forest economy right now, we're just not going to be moving forward quite as strong, that's all."
B.C. Real Estate Board economist Cameron Muir offered much the same comments as Shannon, saying single-digit growth is predicted for Prince George until late 2009 when the U.S. new home market should begin to turn around.
He said an increase in listings may be playing a role. He didn't have numbers specifically for Prince George but for northern B.C. as a whole he said listings are up 34 per cent compared to 24 per cent for the province.
"Homebuyers have much greater selection in the marketplace and there are much less chances for multiple offers," he said. "With a lot of competition among home sellers, that provides much less upward pressure on home prices."
The B.C. northern market is in a "balanced condition" Muir added.
"More of an equilibrium between demand and supply and when we look across the province we're seeing that materialize in most markets," he said.
As a result, prices in most markets in the province will be increasing by single digits rather than the double digits of the last few years, he said.
A BCNREB study release last week showed put the cost of buying a house in Prince George at roughly 32 per cent of family income, compared to 74 per cent in Vancouver and 69 per cent for the province as a whole
