Weakened economic conditions in British Columbia have caused Canada Mortgage and Housing Corp. to reduce its expectations for new-home construction in the province.
Province-wide, the national housing agency is forecasting that builders will start work on 19,725 new housing units, an almost 43-per-cent decline from 2008.
In Metro Vancouver, the expectation is for housing starts to decline almost 44 per cent to 11,000 new units.
The number of home resales in Metro Vancouver are also expected to decline, along with average prices through to 2010.
Canada Mortgage and Housing is forecasting the average Metro Vancouver home price to decline 13 per cent in 2009, and a further 2.3 per cent in 2010.
"Buyers' market conditions that began in mid 2008 will persist through this year before supply and demand conditions become more balanced in 2010," Canada Mortgage and Housing said in its forecast.
The housing agency expects the decline in sales will flatten out later in 2009 as first-time-buyers are lured back into the market by lower prices, but "[s]lower economic growth will keep demand for home ownership sluggish through early next year."
In another report, the research firm Landcor Data Corp. noted that real estate sales recorded through the B.C. Land Title Office dropped to their lowest level since 1985 in the first quarter of 2009.
However, Landcor president Rudy Nielsen said the recent trend of rising sales over the past few months could be signaling that the downturn is near its bottom and represent “a light at the end of the tunnel.”
Or, the blip in sales “could be a grizzly bear with a flashlight. It's tough to guess right now where the hell we’re heading,” Nielsen said in an interview.
Landcor counted 13,786 sales residential real estate sales in the first quarter, about 51-per-cent of the 26,860 properties that traded in the same quarter a year ago.
And first-quarter sales were even down almost 30 per cent from the fourth quarter of 2008.