Home sales rising in B.C. after interest rate cuts: report

Home sales in B.C. are on the rise once again thanks to rate cuts from the Bank of Canada last year.

Home sales in British Columbia are on the rise once again thanks to rate cuts from the Bank of Canada last year.

The B.C. Real Estate Association says the market is finally balanced and is the healthiest it’s been in a decade.

However, looming tariff threats from south of the border put that in jeopardy.

BCREA’s 2025 First Quarter Housing Forecast predicts that Multiple Listing Service (MLS) residential sales in the province will increase 14.3 per cent to 85,140 sales in 2025.

They’re expected to climb even higher in 2026, to nearly 87,970 units.

Last year, 74,000 homes were sold in B.C. That’s slightly higher than the year prior, but below the historical average.

“We had two years of fairly slow activity, and that allowed inventory to come up from an all time low to something that’s been, you know, the healthiest kind of position we’ve seen in close to a decade,” said BCREA Chief Economist Brendon Ogmundson.

New listings rebounded as lower mortgage rates enticed sellers who were hesitant to list in the rising rate environment of 2023.

Fixed mortgage rates fell significantly as the Bank of Canada lowered its overnight rate.

The Real Estate Association expects the central bank will continue cuts before stopping around 2.5 per cent.

The association predicts five-year fixed mortgage rates to stabilize at approximately 4.5 per cent this year.

“Some markets saw prices fall once the Bank of Canada started raising rates, Vancouver actually hit its all time high in terms of its average price in like June of 2024,” said Ogmundson.

He says prices tend to grow at the rate of inflation– so buyers can expect to pay about two per cent more in Vancouver this year.

Although new listings activity has been much stronger than last year, the BCREA says the accumulation of inventory in 2024 had much more to do with a prolonged slump in home sales.

“Markets across BC closed 2024 with significant momentum,” said Ogmundson. “While we are entering 2025 with a high level of optimism and expectations for increased activity, the potential for punishing tariffs on B.C. exports to the United States presents significant uncertainty for the outlook.”

Active listings are expected to return to more healthy levels across B.C.

Experts believe the market will be able to absorb the coming rise in sales activity without a sharp increase in prices.

However after a year of flat prices, the average price in B.C. is projected to rise by 4.5 per cent to $1,025,900.

Tri-Cities Realtor Jordan Macnab says buyers should be prepared for the market to become more competitive.

“For the first time in a while, we’ve seen multiple offers in the last, I’d say, in the last week. So the last three showings that I did, we had multiple offers, multiples yesterday and today. So activity is way up, and there’s just a not a lot of listings coming yet,” Macnab told CTV News.

He expects that will change come spring.

“So many people have been on the sidelines for so long with the interest rates and Trump and everybody’s a little bit scared, but those people who really need to move or want to move, are starting to show activity, getting back on to the open house scene, and actually starting to make offers again.”

Buyers are being urged to get pre-approved for a mortgage now, before things pick up in the coming months.