Whistler Real Estate Blog

March Newsletter – Happy St.Patrick’s Day

What’s available?
Follow the links to the wonderful properties that are on the market

Luxury Estates
Cheap and Cheerful Whistler Shacks
Village Blackcomb and Creekside – Properties you can rent yourself
Hotel Investment Properties aka. Phase Two
Shared Ownership

Whistler Market Update – February 2018

The report below shows benchmark prices for properties in Whistler. If you would like to learn more about benchmark prices, follow this link for some great information.

This is what you have been reading about… in a nutshell.

The past few years have seen unprecedented change in the BC real estate industry. While price inflation has been the big story, there have also been rapid shifts in market preferences, intense competition within the industry, concerns about eroding professional standards resulting in the introduction of a new regulatory regime, and changes in government policies that have all presented major challenges. Moreover, the trend toward rapid change is likely to continue in 2018.

Where the market is heading is anyone’s guess, and the uncertainty is greater than ever, with strong forces working both for and against continued price escalation.

Headwinds keeping prices in check include:

  • Existing High Prices
  • Rising Interest Rates
  • A mortgage lending Stress Test designed to ensure new mortgagees can afford rising rates
  • The Vancouver Empty Homes Tax
  • Increasing Capital Controls for money coming out of Mainland China
  • Talk from the BC Provincial Government that they want to see prices not just soften, but fall
  • Policy changes in the recent BC Provincial government aimed at curbing real estate price growth, including punitive extra property purchase taxes applied to “foreign” buyers
  • However, tailwinds, possibly more forceful than the headwinds, include:

  • Continued historically-low interest rate environment
  • Demographics that show that the Millennial generation has just surpassed the baby boomers in size and are just entering their prime household formation years
  • The strongest economy in Canada with an historically low unemployment rate
  • An increase in Canadian immigration from 250,000/year to 340,000/year
  • Record numbers (100,000+) of foreign students in BC schools, many of whom come from prosperous families whose agenda is to enable the kids to immigrate to Canada after completion of their studies
  • 1.5 million 10-year unlimited entry Visas issued to Chinese nationals in only 3 years
  • A vibrant hi-tech sector that lures many well paid young professionals to the province
  • The fact that BC is a prime retirement destination for aging baby boomers from all over the country
  • One of the highest household net worth averages in North America at $1.6 million/household
  • Growing political uncertainty in China, the major source of foreign capital invested in BC real estate
  • Interestingly, while the strongest headwinds are driven by BC government policy, so are some of the more pronounced tailwinds, such as the policies of encouraging tourism and promoting the province as a destination for foreign students. Moreover, Federal government immigration programs, ostensibly aimed at economic development in other provinces, in fact drive billions of dollars annually into BC’s residential real estate market. In the realm of policy, it is possible that Federal policies will overwhelm anything done at the Provincial or Municipal levels. And, of course, the most forceful tailwinds are still being generated by pure economic fundamentals of low supply and strong demand.

    Along with all of the uncertainties, the BC Provincial government recently introduced budget measures that will impact the real estate industry. They are:

  • An increase in the Property Transfer Tax rate for values above $3 million from 3% to 5%
  • An increase in the School Tax on residential property of 0.2% that will apply to property values above $3 million and 0.4% on property values over $4 million
  • An increase in scope and rate of the Foreign Buyers’ Tax from 15% to 20% and adding:
  • a) Metro Vancouver (already included)
    b) Fraser Valley Regional District
    c) Capital Regional District (Victoria)
    d) Regional District of Central Okanagan (Kelowna)
    e) Regional District of Nanaimo

  • A new annual Property Speculation Tax of 0.5% in 2018 and rising to 2% in 2019. The tax will target owners of property who pay little or no BC Provincial tax. Details to follow in the Fall.
  • While the BC Provincial government has pushed these reforms as affordability measures, they may in fact encourage wealthier buyers to compete for cheaper properties or rent. This could push up rents and prices for entry-level homes. Consequently, some of these policies appear to be pure tax increases rather than honest efforts to improve housing affordability for British Columbians.

    Shauna O'Callaghan

    Shauna O’Callaghan is a long-time Whistler resident and real estate agent. Put her experience to work for you!