This information was forwarded on to me from Charlie Parker from RE/MAX in Nanaimo.

These are some very encouraging thoughts for the market!

Outlook Sees B.C. House Sales, Prices Increasing

The median price of a B.C. detached house on MLS will rise to $391,000 by next year - up from $369,000 this year - while the median strata price will jump to $345,000, up from $325,000, according to a very bullish B.C. housing market forecast released this week by Central 1 Credit Union. The report sees total housing sales rocketing to a record high of 140,000 units in 2010 - up from just 98,226 in 2008 and 108,200 in 2009 - before falling back to 138,000 sales in 2011. Why the optimism? According to Central 1 chief economist Helmut Pastrick, the record housing sales will be due to “favourable mortgage rates, a growing economy, and easier credit for builders and developers”. Pastrick forecasts that mortgage rates will start to turn up “with conviction” in mid-2010. He thinks the 5-year closed rate for mortgages at major banks will be at 7% by 2011 (it is now around 5.8%). As for the rental vacancy rate, Pastrick sees the province-wide rate rising to 2.1% next year (from 1.6% today) before dropping to 1.7% in 2011.

Major Point: Keep in mind that CMHC vacancy rates are based on rental purpose built buildings of 3 or more units. This means that stats for the thousands of condos sold to investors and now flooding the market are NOT in the vacancy rates. We think the rate is more in the 3% - 4% rate already. Also, the stated mortgage of 5.8% can still be beaten down to 3.9% or so!!! Also, the long term (5 years or so) rates are dependent on the bond market and not the BOC. However, this report from a very credible source will be more fuel for the confidence level among B.C. home buyers. The market is turning to a sellers market, but with low mortgage rates in effect for at least another six to eight months, there is still plenty of time to find that great deal.