B.C. Home Prices to Continue Rise, Driven by Greater Vancouver, Forecasts Central 1 Credit Union

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Nov. 10, 2015) - B.C. home prices and sales will keep rising for the next two years, says a new forecast by Central 1 Credit Union.

Province-wide sales growth is expected to slow in 2016 as housing supply constrains growth in Metro Vancouver and the Alberta recession and weak mining sector hamper demand in the Interior. The median home price will rise by nearly six per cent to $425,000 this year, $450,000 in 2016 and $462,000 in 2017.

In Greater Vancouver, strong demand and a shortage of land for new housing developments will drive prices higher and speed the shift from detached houses to multi-family units.

"A widening gap between detached and multi-family homes is the new norm," says Central 1's Senior Economist Bryan Yu. "The region is in the middle of a long-term transition from families living in detached homes on expensive land to families living in higher density condos and apartments."

"In previous years the housing ladder meant starting in a condo and transitioning to a detached home; that will no longer be the trend," Yu says. "For most families the housing ladder will lead from one multi-family unit to another."

"Vancouver's geography allows limited space for new housing which means increasing demand will send prices and condo towers higher," Yu says.

Highlights:

• Mortgage rates will stay low through 2017 fuelling continued demand.
• Provincial housing starts will climb nine per cent this year to 31,100 units, rising to 32,400 units in 2016 and 33,500 units in 2017.
• In Vancouver the price of the median detached home will breach $1 million in 2017, while apartments tip $405,000.
• Greater Vancouver is set for further price increases over the next two years despite strong recent gains as demand remains robust and supply remains heavily constrained.
• The widening gap between detached and multi-family home prices will persist as land shortages and prices speed the shift from detached to multi-family units.

Read the full report BC Housing Forecast Update 2015-2017.

About Central 1

With offices in Vancouver, Mississauga and Toronto, Central 1 - which holds approximately $14 billion in on balance sheet assets - provides wholesale financial products and trust services, along with digital and payment services that power innovation in retail financial services for more than 300 credit unions and institutional clients from coast to coast.

In addition, Central 1 is the primary liquidity manager, payments provider and trade association for our member/owner credit unions in B.C. and Ontario. Our members represent a consumer-oriented, full-service retail financial system that serves 3.3 million members and holds more than $102 billion in assets. For more information, visit www.central1.com.