Fiona Anderson
Sun
The number of British Columbians who say they are likely to buy a home dropped significantly in the last year, according to a survey by RBC Royal Bank.
Only 11 per cent of those surveyed in the province said they were very likely to buy a home in the next two years, down from 16 per cent a year earlier.
While 31 per cent of British Columbians surveyed said they might buy, it’s the “very likely” statistic that reflects the market, said John Wright, senior vice-president of Ipsos Reid who conducted the 13th annual home-ownership survey on behalf of RBC.
The decline in the number of likely buyers could be for a variety of reasons, said Inde Sumal, regional manager, Mortgage Specialists, with RBC Financial Group.
“It could mean the housing market has been exceptionally strong over the last few years and now people have already bought,” Sumal said. “It could mean that affordability is high.”
The survey also found that people in B.C. and across Canada expect mortgage rates to increase, another reason buyers may decide against buying a home, Sumal said.
Of those surveyed, homeowners in B.C. had the most expensive homes, averaging $313,370, well over the Canadian average of $214,337. British Columbians also carried the country’s largest mortgages on average, $128,086 compared with the national average of $95,840.
Georges Pahud, president of the Real Estate Board of Greater Vancouver, is not concerned about the lower intentions to buy, even though sales in the Vancouver area fell 4.1 per cent in February, compared with the month a year earlier.
“People’s preferences and what they do are different things,” Pahud said. “[So] I don’t attach a lot of importance to this report.”
Pahud believes home sales may be lower in 2006 than 2005, but 2005 was a record year and the market can’t expect every year to be a record.
“If we are slower in 2006 than 2005 we will still be better than 2001 and 2002,” he said.
Economists are predicting a strong market for the foreseeable future and so does Pahud.
“Interest rates, employment, confidence in the economy, in-migration: all those elements are there and none of them indicate anything but a positive outlook,” he said.
Potential realtors are anticipating a strong market as well, if the numbers registering to be licensed is any indication. About 4,500 people took the licensing course in 2005, and 2006 is looking to be the same, said Anthony Cavanaugh, communications officer with the Real Estate Council of B.C.
Across Canada, buying intentions were the lowest since 2000, with 29 per cent of Canadians surveyed saying they might buy a home, but only 10 per cent saying they were very likely to do so, down from 13 per cent a year earlier. Only Alberta and the Atlantic provinces bucked the trend, with the number of Albertans who said they were likely to buy remaining steady at 18 per cent while the number of Easterners looking for a home increasing to 14 per cent from eight per cent, Wright said.
