COVID-19 could derail recovery of real-estate market in Vancouver and beyond

The housing market could be in for a rough ride because of the COVID-19 pandemic.

That’s according to Brendon Ogmundson, chief economist with the B.C. Real Estate Association.

According to Ogmudson, the real estate market will highly depend on what will happen with the economy in Canada, with the affects from COVID-19 affecting it negatively.

“What we know is that we’re going to get kind of like a sudden stop in economic activity for the next couple of months,” Ogmundson told the Georgia Straight in a phone interview.

“So I think what we’re looking at for the B.C. economy is a couple of pretty, pretty lousy months for March, April, May, maybe extended to the summer.”

Ogmundson claims that real estate is a "face-to-face kind of business", therefore we need to pay attention to the matter of the fact that a huge amount of people are in self-isolation and staying home, this can impact the housing market as many may choose not to sell their homes or buy homes at the time of a global crisis.

“So if we just get kind of a sharp kind of decline in the next couple months but things rebound in the second half of the year, I think that we’re going to end the year down but healthy,” Ogmundson said.

Although Ogmundson also has another opinion. He says if things get "a lot more serious" the real estate market can be very negatively impacted, with sales declines for the period of COVID-19 lasting, perhaps with a slim decline in home prices as well.

Based on figures so far this year supplied by the Real Estate Board of Greater Vancouver, the real-estate market is trending up. However this can all change due to the recent global pandemic COVID-19.

In February 2020, year-over-year there was a 44.9 per cent increase, totalling 2,150. Along with this February's amount of sales were 36.9 higher than January's. And January was not a poor month for the real estate market either being 42.4 per cent increase year-over-year.

REBGV president Ashley Smith noted that even early numbers for the month of March this year suggest a “strong direction as well”.

However, with the spread of the novel coronavirus, Smith noted that something else has emerged.

“We’re hearing about good activity in some cases, and, again, multiple offers in some cases,” Smith continued, “and then another side has some, you know, natural response to things like this, where people are cancelling showings, cancelling open houses.”

Although people are still attempting to keep the market moving, with people turning to private showings rather than open houses. 

“So how this will all play out, I think it’s still unknown,” Smith said.

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Summarized by: Onur Gul on instagram at @onurgulfilm