Even though the unemployment rate has doubled, the housing market continues to rally. Many homeowners in British Columbia, as well as in the rest of the country, were able to keep their homes even though they may have lost their jobs due to unforeseen circumstances. In tandem with that were lower interest rates that allowed some people a foray into the real estate market and gave some prospective buyers more house for their money.
Home prices are continuing to sizzle in the country's most western province. The prices of homes in most of British Columbia have risen year-over-year as of July. Real estate continues rally even though some other sectors of the economy have continued to take a hit.
The way in which homes are being marketed and sold today is increasingly changing the housing market landscape. Online auctions are being used more frequently to move real estate in British Columbia. In fact, an upscale property in the Okanagan Valley sold last summer for $5 million after a fight between nine online bidders.
It seems as though most sunshine coast residents have definitive thoughts on who should be owning property. A recent survey has shown that 78% of British Columbia residents are in favour of implementing policies that restrict foreigners from buying real estate in the province. It is thought that foreign investment is a key factor in driving up property values.
May brought encouraging news to the province's housing sector. Analysts say recovery signs in the real estate market in British Columbia were encouraging last month, even though year-over-year numbers remained down. The British Columbia Real Estate Association (BCREA) said 4,518 residential homes were sold in May, up from April's 3,284. Total sales dollar-wise grew from $2.4 billion to $3.3 billion.
Investors are always wary of circumstances that could adversely affect their investments. In times of global worry and economic crisis, real estate investors need to be mindful of safeguarding their portfolios to weather the storm. Business is not as usual in British Columbia in these times and even lenders have revisited their lending policies, which is affecting investors -- especially those with high margin investment methods such as student rentals, flipping, short term rentals and construction.
Investors aren't going to like the recent real estate market forecast. When assessing global risk for wealthy investors, British Columbia and the rest of the country was hit hard by yet another global risk agency: that real estate prices will continue to drop by double digits. Numbers are gathered around unemployment rates which will hit 14% -- or the adverse rate -- by the year's end.
A developer based in the Okanagan is offering investors the chance to get in on what it says is the best opportunity in the province. British Columbia real estate development company West K Homes, will be breaking ground shortly on 103 resort residences in Vernon. The president of the company says the 313-square-foot condo units are designed for trendy, compact living.
No industry is sheltered from a worldwide pandemic. The real estate industry in British Columbia has made the decision to stop all open houses given what is happening with a pandemic that is highly contagious. The British Columbia Real Estate Association (BCREA) is heeding the recommendations it has been given by local real estate boards across the province.
Much property in British Columbia continues to be unaffordable to many which is fuelling the crisis in the market. High prices are actually forcing some British Columbia residents to look outside the province when it comes to securing real estate and some analysts say this is having a negative effect on market balance overall. Inflated prices make it difficult for some -- like seniors, young families and single individuals -- to purchase real estate in the province.