Northern real estate sales booming

While the market may be cooling in other parts of the province and the nation, the north it seems is still in the midst of boom times, with the value of sales up more than fifty percent in the last year.

Long the real estate laggard in British Columbia, this last year saw this part of the province turn the corner in real estate, with the B. C. Northern Real Estate Board suggesting that the trend will continue for the foreseeable future.

However, like all statistics in the North, it’s very much a tale of two regions, part of the credit for the boom in sales and optimism go towards the rock bottom unemployment of the Peace area, other parts of the region of course aren’t quite as prosperous as that corner of the oil patch and it’s Alberta like economic growth. It would be interesting to see the figures broken down according to the different parts of the region to get a better view of the real estate scene in the north.

While there has been a noticeable improvement on the North Coast, it’s unlikely that it’s the same rapid change of direction that Fort St. John and similar towns in the eastern half of the region have seen. Our market seems to have been driven more by speculation over the container port project, than by any concrete turn around of the local economy. It could make for a situation that provides for a false level of activity as far as any economic indicator locally.

Regardless, there has been an increase in local properties being sold, which is a far cry from what was happening a few short years ago. This in itself is at least a sign that things might finally be heading in a better direction.

The Daily news featured the story as its front page item in Tuesday’s paper.

THE NORTH SETS THE PACE AS PROPERTY BOOM CONTINUES
After a recent lag, homes in province’s North now leaping up in value
By James Vassallo
The Daily News
Tuesday, December 5, 2006
Pages one and three

In the face of a real estate pullback around the province, the North is booming with the value of sales up more than 50 per cent in just a year.

“We’ve been lagging behind the province for about six years,” said Ted Shepperd, B. C. Northern Real Estate Board president. “We’re finally recovering and I don’t see that our trend is going to reverse,”

In October 2006, the Northern region saw a 29.5 per cent increase over October 2005 with the number of residential units jumping from 404 to 523 houses. Similarly, the value of those home sales shot up 50.5 per cent from $60.5 million to just over $91 million.

We’re going to continue to improve for the near future anyway and I think the long-term looks good too,” said Shepperd adding that those improvements will likely continue in both areas – the price of homes and the number than change hands.

The B. C. Northern Real Estate Board includes communities from Prince Rupert to Prince George to the border, including Fort St. John and Fort Nelson, but not Dawson Creek.

Overall, figures indicate B. C.’s residential sales on the Multiple Listing Service (MLS) reached $2.96 billion in October 2006, up seven per cent from October of last year.

The increase in sales volume is due to rising home prices during the last 12 months. However, in other parts of B. C. the number of homes sold is down, in some areas significantly.

The average home price in B. C. rose to $410,728 in October, up 20 per cent over October 2005, but sales dropped 11 per cent to 7,196 houses last month, the fourth consecutive month of decline.

“Home sales in the province are definitely easing back from last year’s record-breaking pace,” said Cameron Muir, British Columbia Real Estate Association chief economist. “While a strong provincial economy continues to underpin consumer demand, affordability concerns are keeping some would-be home buyers on the sidelines.”

The provincial association reports that robust job growth, rock bottom unemployment and wage and salary increases that are outpacing inflation still bode well for the housing market.

The combination of low mortgage rates and high consumer confidence has led to the major run-up in housing prices that is making it difficult for some homebuyers to find the type of house in the location they want for a price they can afford, he said.

“The B. C. housing market is now trending toward more balance between buyers and sellers,” said Muir. “The combination of less frenetic buying activity and a moderate increase in the number of homes for sale is providing more choice for home buyers and easing upward pressure on home prices.”

Although the year-to-date figures have declined eight per cent to 85, down 399 units from last year, the BCREA estimates sales will reach 96,000 units in 2006, the second highest recorded for the province.