Home prices have fallen across the Lower Mainland over the past year, but this may soon change, according to a Royal LePage report released April 18.
The introduction of the foreign-buyer tax played a role in the price decreases as the number of homes sold has fallen, but there may be reason to believe this market correction could turn around soon, said Phil Soper, president and CEO of Royal LePage.
“The principal victims of the B.C. government’s foreign-buyer tax were Canadians who had planned to sell or buy a home and were frightened away by unsubstantiated rhetoric in which the Chinese were entirely to blame for Vancouver’s housing shortage,” Soper said. “The reality is that as much as 90% of the housing activity that disappeared overnight in the Lower Mianland after the tax was introduced was from Canadian residents, not foreign investors.
“Homebuyers are waking up to this reality and may be ready to rush back into the market.”
Soper said it is possible that in the next several weeks, “six months of pent-up demand will be unleashed on the market,” which could cause prices to increase to the levels they were before the foreign-buyer tax was introduced last year. At that time, there was already a market slowdown in place due to eroded affordability.