STATS ON BOWEN – March 2022

Further Bank of Canada rate increases expected

On April 13th, the Bank of Canada raised its rate by 0.50 per cent to 1.0 per cent. Canadian Mortgage Trends reported:
Those with floating variable rates will see their payments rise, while those with fixed-payment variable mortgages will have more of their payment go towards interest and less towards principal repayment. *
There are 5 more dates this year when the Bank will again address the rate again and many anticipate that each may see another increase, with the rate forecasted to be 2.0 -2.25 per cent.

Reuters reported a similar forecast:
The big five banks also expect another half-point rate rise at the June meeting, even though the wider poll expects the pace of rate rises to slow to quarter-point increments each month, taking rates to 2.00% by the end of 2022. Interest rate futures pricing shows the overnight rate even higher, at 2.75% by end-year. **

All metrics in March increased year-over-year (Y0Y) except for inventory and number of sales. Bowen Island continued to lead Metro Vancouver in percentage increase in the MLS® Home Price Index compared to 2019 and was only 1.0 per cent lower than Langley City which recorded the highest YoY percentage change of 47.1 per cent compared to 2021.

At the end of February, the MLS® HPI was $1,455,525 YoY – a 46 per cent increase YoY – while the Median Sale increased by 24 per cent and the Average Sale by 34 per cent. The number of days a property stays on the market decreased by 61 per cent to an average of 25 days as buyers react quickly to new inventory.

During the past 12 months the $1.0-1.5 million category accounted for 40 per cent of sales and the $1.5-3.0 million category accounted for 48.6 per cent – almost half of the sales were for properties listed between $1.5-3.0 million compared to only t8.6 per cent listed under $1.0 million for the same period.

As we move through 2022, mortgage rates will rise, and combined with the stress test, will reduce buying power. The market will slow and pressure on prices may ease somewhat in the last quarter of the year and early 2023.

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