Just before the pandemic struck, Surrey real estate was showing positive signs for a brisk spring market.
Consumers were recovering from the mortgage stress test introduced in 2018 and new listings were starting to trickle onto the market to meet pent up demand. Further, the economy was buoyed by steady job growth, a vibrant labor market, strong immigrant housing demand and low interest rates.
2020 was looking good from a real estate owners perspective – but now that the residential housing market has lost its footing – homeowners are left wondering how an unprecedented event like COVID-19 will affect their homes value.
For now property values are holding steady but how long can this persist? The question looms; “Will summer 2020 become the new spring market”?
The spring market has been delayed as most potential sellers don’t want strangers coming into their home. Understandably so. Similarly, buyers have been staying home, but with social restrictions scheduled to ease up following the Victoria Day Long Weekend many are expecting new listings and buyer demand to increase as people get on with their plans to buy or sell.
Analysts suggest if BC continues to bend the curve we could see a strong spring-type market emerge but they remain more cautious when it comes to the BC economy. Data is still scarce but there is little doubt risk is growing. Service industries, like tourism and hospitality have been flattened and with air travel now very difficult we are essentially cut off from global supply chains. Bricks and mortar retail was already struggling before this crisis and now this sector finds itself having to rethink its footprint and liquidity.
See the May 8, 2020 employment report from the British Columbia Real Estate Association on our blog page.
The above being said, real estate in 2020 and into 2021 is really a question of how much damage has been done to household incomes and how low interest rates are going to be.
So far property owners have been spared the worst of this crisis as most of the initial job losses tend to be in sectors where you find a lot of younger people and renters. The real risk is that this crisis goes on for a long time.
With all this uncertainty it’s easy to get caught up in the noise but for now the summer looks bright and the long term outlook for housing demand in BC remains optimistic.
Keeping you posted on all things real estate,
Jenn & Colin
Photo by Zac Durant on Unsplash
