This year has proven to be a tough year for B.C.’s real estate market, defined by sluggish sales and rising inventory.
Despite the Bank of Canada’s series of interest rate cuts in 2024, key issues like affordability, high construction costs, rising taxes on developers, and red-tape at the municipal level continued to hinder the success of buyers and sellers.
“All the damage has been done,” Trevor Koot, CEO of the BC Real Estate Association (BCREA), told 1130 NewsRadio.
One of Koot’s main concerns is the lack of new development this year.
“We’ve seen good numbers for purpose-built rentals, but there’s a balancing act with policies surrounding foreign investment, foreign buyers, and changes to non-permanent residents. These policies are intended to amplify opportunity, but we still need that investment to incentivize building.”
The reality, according to Koot, is that large-scale projects — often worth hundreds of millions or even billions of dollars – require speculation and risk.
“The government can’t do it all. We need investment to make these projects happen. We need more supply in order to start to dampen some of the pressure on housing,” he explained.
In reflecting on the past year, Koot highlighted several key points the BCREA pushed for, including a greater focus on trades training to address workforce shortages, revisiting tax policies like the property transfer tax to ease barriers for first-time buyers, and the provincial government’s efforts to promote densification.
While the provincial government has made progress in removing some barriers, Koot says municipal approval processes — especially in terms of cost and time — remain a significant challenge.
BC Real Estate Association cautiously optimistic for 2025
Looking ahead to 2025, Koot is cautiously optimistic. He anticipates a more balanced market and sees promising signs, particularly in the spring, when he expects a surge of activity from buyers who have been waiting for the right moment.
“We expect that there’s going to be some movement with some of the inventory that’s that stocked up,” he said.
However, Koot notes that sellers who are still holding onto expectations from earlier in the year may need to recalibrate their expectations.
“Sellers often look at past prices and think they can still achieve them, but it takes time for the market to adjust.”
Koot emphasizes that success will depend on a range of factors, such as how many buyers return to the market, the pressure they put on available inventory, and the psychological environment surrounding the market at the time.
“Both buyers and sellers should work with their realtors for guidance and understanding of the market to ensure they’re confident in getting the best price in that moment.”