{"id":8826,"date":"2018-04-20T10:10:24","date_gmt":"2018-04-20T17:10:24","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=8826"},"modified":"2018-04-19T09:44:54","modified_gmt":"2018-04-19T16:44:54","slug":"bc-affordability-is-set-to-worsen-in-2018-2019","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2018\/04\/bc-affordability-is-set-to-worsen-in-2018-2019\/","title":{"rendered":"BC Affordability is Set to Worsen in 2018 &#038; 2019"},"content":{"rendered":"<p style=\"text-align: justify;\">Although the BC government recently implemented a new housing plan to curb demand and slow skyrocketing prices, housing affordability is slated to deteriorate further this year and in 2019.<\/p>\n<p style=\"text-align: justify;\">According to a new Scotiabank Economics report, the Bank of Canada is expected to increase interest rates over the next two years, and as a result, affordability will continue to worsen long-term.<\/p>\n<p style=\"text-align: justify;\">\u201cThe Bank of Canada, after raising its policy rate 25 basis points in January, is expected to follow up with two more rate hikes this year and to continue on a gradual tightening path with three more hikes in 2019,\u201d reads the report, published this week.<\/p>\n<p style=\"text-align: justify;\">Currently, to purchase an average priced home in Vancouver, mortgage carrying costs account for over 65% of a median household income \u2014 a record high, says Scotiabank. Even condos, which are a more affordable homeownership option in the city, absorb more than 40% of median income.<\/p>\n<p style=\"text-align: justify;\">According to the report, average home prices in Vancouver would need to drop by roughly 25% from current levels in order to bring mortgage carrying costs relative to household income back to the long-term average of around 50%.<\/p>\n<p style=\"text-align: justify;\">In an effort to address poor affordability across the province, the BC government unveiled its housing plan in February, as part of its 2018 budget. The comprehensive plan includes a new speculation tax, along with an increase to the existing foreign buyer tax to 20% and extending its boundaries.<\/p>\n<p style=\"text-align: justify;\">Scotiabank says these new property taxes combined with stricter mortgage regulations and rate hikes will likely lead to a small slowdown in home sales this year. Prices, on the other hand, are expected to continue rising.<\/p>\n<p style=\"text-align: justify;\">\u201cAverage MLS home prices are forecast to post another year of relatively moderate low single-digit increase in 2018, though this in part reflects the continuing compositional shift in sales toward lower-priced dwellings,\u201d reads the report.<\/p>\n<p style=\"text-align: justify;\">In the near-term, the bank says higher interest rates and BC\u2019s new housing policies could slow upward pressure on prices, but that cooling off period won\u2019t last for long.<\/p>\n<p style=\"text-align: justify;\">\u201cOver the medium- and longer-term, there is a strong likelihood that average home prices in BC\u2019s largest urban centres will continue to trend higher, supported by a growing population and rising land costs,\u201d reads the report.<\/p>\n<p style=\"text-align: justify;\">This year, benchmark home prices in BC\u2019s Lower Mainland and South Vancouver Island are expected to increase by 5 to 10%.<\/p>\n<p><a href=\"http:\/\/news.buzzbuzzhome.com\/2018\/04\/bcs-housing-plan-affordability-worsen-2018-2019.html\" target=\"_blank\" rel=\"noopener\">Despite BC&#8217;s New Housing Plan, Affordability is Set to Worsen in 2018 &amp; 2019<\/a> by Kerrisa Wilson | Buzz Buzz Home<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Although the BC government recently implemented a new housing plan to curb demand and slow skyrocketing prices, housing affordability is slated to deteriorate further this year and in 2019. According &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2018\/04\/bc-affordability-is-set-to-worsen-in-2018-2019\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"class_list":["post-8826","post","type-post","status-publish","format-standard","hentry","category-market-updates"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>BC Affordability is Set to Worsen in 2018 &amp; 2019 &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2018\/04\/bc-affordability-is-set-to-worsen-in-2018-2019\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"BC Affordability is Set to Worsen in 2018 &amp; 2019 &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"Although the BC government recently implemented a new housing plan to curb demand and slow skyrocketing prices, housing affordability is slated to deteriorate further this year and in 2019. 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