(Black Press Media files)

Mortgage test, high supply to keep cooling B.C. housing prices in 2019, report says

The BC Real Estate Association says new lending rules are still affecting buyers

The mortgage stress test is expected to continue to put a damper on any major price increase in B.C.’s housing market throughout 2019, according to the B.C. Real Estate Association.

In a first quarter forecast update released Monday, the association said the test is expected to continue “constraining” housing demand this year.

READ MORE: B.C.’s skyrocketing real estate market will ‘correct’ in 2019, says analyst

The stress test, introduced at the start of 2018, requires all borrowers to qualify for a mortgage based on either the five-year benchmark rate or their lender’s actual rate plus two per cent, whichever is higher. The change applies to all mortgages, new or renewed, even if the down payment exceeds 20 per cent.

The average price of a home in B.C. stayed mostly steady, up just 0.5 per cent to $716,100, in the first quarter of 2019.

The association expects 80,000 units will sell by the end of the year, compared with 78,345 last year.

Although the province has seen five years of “above-trend economic growth,” and has the lowest unemployment in Canada – spurring on housing demand – the association said job growth will likely slow down in the coming years.

That shift will push down the province’s gross domestic product from 2.8 per cent to 2.6 per cent in 2019, leading to a slight downturn in housing demand.

That, mixed with the record number of new homes being built this year, will keep any housing shortages at bay.

READ MORE: Real estate board calls on Ottawa to revisit mortgage stress test


@katslepian

katya.slepian@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Three people from recovering from shellfish poisoning

Butter clams harvested in November 2018 could cause paralytic shellfish poisoning

Port Clements gets cell service

Telus built a $500,000 wireless communication site for the remote Haida Gwaii village

Identifying child care space needs on the island

B.C. government is providing a $25,000 grant for more than 70 communities to help improve daycare

Northwest mobile unit to help those at heart of mental health, addiction crisis

Province, Northern Health unveils new unit in Terrace to bridge gaps in services

Sk’aadgaa Naay slips in Fraser Institute elementary school rankings

The school stayed at a rating of 5, but slipped to 694th rank in 2017/18

VIDEO: The ‘most cosmopolitan’ of butterflies could migrate to B.C.

The painted lady butterfly will likely arrive this summer from Southern California

Is it a homicide? B.C. woman dies in hospital, seven months after being shot

Stepfather think Chilliwack case should now be a homicide, but IHIT has not confirmed anything

Indecent caller handed 18-month conditional sentence

Vancouver Island man pleaded guilty to making indecent phone and video calls to women across B.C.

Sources say Trudeau rejected Wilson-Raybould’s conservative pick for high court

Wilson-Raybould said Monday “there was no conflict between the PM and myself”

First Nations public art piece stolen in Nanaimo

Spindle Whorl went missing over the weekend, according to Nanaimo RCMP

Father-son duo at B.C. Children’s Hospital helps new dads fight depression

The pair teamed up to introduce the only known research-based mindfulness workshop for new dads

Mexican restaurant in B.C. told to take down Mexican flag

General manager of Primo’s Mexican Grill in White Rock: ‘I’ve never heard of anything like this’

B.C. NDP moves to provide tax credits, tax cut for LNG Canada

Provincial sales tax break of $596 million repayable after construction

COLUMN: Smart phone too powerful a tool to yank from students’ hands

Rather than ban them from schools, let’s teach kids to harness their phone’s power and use it properly

Most Read