Home Sales Surpass Expectations in 2nd Quarter

Vancouver, BC - July, 2007

British Columbia Real Estate Association (BCREA) reports that residential sales volume on the Multiple Listing Service (MLS) in BC rose 20.4 per cent to $4.98 billion in June, compared to the same month last year. Residential unit sales increased 8 per cent to 11,175 units during the same period. The average MLS residential price hit $445,747, up 11.5 per cent from June 2006.

"Our expectation was for a continued moderation of home sales in the second quarter," said Cameron Muir, BCREA Chief Economist. Home sales rose 7 per cent April through June reaching 32,535 units, which is near the record 32,981 units sold during the second quarter of 2005. "Homebuyers have been scrambling to take advantage of pre-approved mortgages that were negotiated before the recent hike in posted rates," added Muir. The five-year conventional mortgage rate climbed 75 basis points to 7.24 per cent over the second quarter of 2007.

However, Muir cautioned that higher mortgage interest rates are not the only reason for the strong second quarter results. "Consumer confidence is crucial to housing demand in the province," added Muir. "With an abundance of employment opportunities and rising wages and salaries, households are reaping the benefits of a robust BC economy, and demonstrating their confidence by purchasing the most expensive asset they will likely ever own."

Year to date, MLS residential sales volume climbed 12.5 per cent to $23.6 billion, compared to the first half of 2006. MLS home sales edged up 0.5 per cent to 54,734 units, while the average MLS residential price climbed 12 per cent to $431,873.

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