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HomeNewsRising interest rates predicted to slow northern housing activity in 2023

Rising interest rates predicted to slow northern housing activity in 2023

“Listings will be on the market longer,”

That’s from BC Real Estate Association Chief Economist Brendon Ogmundson who unveiled its first-quarter forecast today (Tuesday).

The north is expected to see 4-thousand sales this year, a 6% year-over-year decline from 2022.

Our region tallied just under 43 hundred unit sales last year – a 22% year-over-year decline following a record-breaking 2021.

Ogmundson told Vista Radio market conditions aren’t expected to improve until the end of this year or early in 2024. But, that will likely pave the way for a resurgence.

“If that is what is going to occur, fixed-mortgage rates will fall in anticipation of that – this will provide a boost to the housing market where we would see a very strong recovery as we usually do post-recession.”

“Our most likely scenario for the housing market, which is based on an economy that is slowing in 2023 but that slowing economy and even for the potential of a recession means the Bank of Canada can take its foot off the brakes and even cut rates either by the end of 2023 or early 2024.”

As for how the slowing demand will impact sellers, Ogmundson stated a lot more listings will be on the market for a little longer than usual.

“Listings are going to be on the market a little bit longer and it’s going to be more difficult but better for buyers who have a lot more choice even with the limited amount of supply we have.”

He expects prices to flatten out in the region this year, resulting in a 1% decline. The average price in the north is expected to hover around $410,000.

Provincially, it’s predicted to be more than double that at $925,500.

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