‘Don’t try to time the market’: What the interest rate hike means for B.C. real estate

According to a new survey by Century 21 Canada, B.C. takes the top spot, particularly in detached houses on Vancouver's West Side, despite interest rate hikes.

"We recognize the concerns that some might have because of interest rates, but the first half of 2022 showed growth in nearly every regional market in the country," says Brian Rushton, Chief Operating Officer of CENTURY 21 Canada.

The nationwide study compared the price per square foot of properties sold between Jan. 1 and June 30, 2022, with the same period last year and the previous year.

Some markets cooled after the boom during the COVID-19 pandemic, but overall, prices have remained elevated since the start of the year.

"The trend is still towards higher prices, especially in suburbs where younger and first-time home buyers are looking to escape competitive metropolitan areas now that remote work has become more common. What will be interesting is to compare the data we've received from the first half of this year with the data we gather in 2023 to see how the rising rates impact the market for the next six months," says Rushton.

In B.C., the survey points to high prices making buyers look outside the downtown core. Kelowna and Chilliwack, for example, saw sharp price increases. Condos in those two cities saw a 28 per cent and 35 per cent increase in price, respectively, in the first half of the year, according to the release.

Brendon Ogmundson, the Chief Economist at B.C. Real Estate Association, says the market is very different than the first half of the year.

"Five-year fixed mortgage rates have more than doubled since the start of this year. That means borrowers that have a five-year fixed rate and like five per cent need to qualify with the stress test at like seven per cent. No surprise that, given how fast rates have gone up, we've seen market activity slow pretty substantially," he says.

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