As we send off 2017 and look forward to a new year to come, it’s insightful to ponder on some of the big trends and changes that will likely impact the Whistler real estate market next year. Some of these changes are on a macro level, effecting the entire nation, while some are more localized to the Whistler region. If you’ve been wondering what we’ll likely see in the way of real estate next year, here is what I believe will shape the local market.
Strong US Dollar
The strong US dollar has been impacting the Whistler real estate market for a few years now and this is set to continue in 2018. The United States economy is robust, and the greenback is expected to reflect this in the year to come. What this means for Whistler real estate is continued demand from US property buyers and investors who can get more for their money north of the border. This of course is putting increased pressure on our housing supply, with supply unable to meet demand.
Rising Interest Rates
The Bank of Canada has raised interest rates three times already this year, and rates are expected to continue rising into 2019 until they stabilize at around 2.9 percent. Though inflation is slowing and caution exists around household debt levels being impacted by sudden rate rises, there seems to be a consensus among financial experts that rates will continue in an upwards direction. We have enjoyed a sustained period of very low interest rates and rates will continue to be low over the next few years though higher than we have experienced in recent times.
New Mortgage Stress Test
As of January 1st borrowers of uninsured loans will need to qualify at higher interest rates. This will affect purchasing power of buyers with down payments of 20 percent or greater. This isn’t expected to impact the Whistler market too significantly as many of our properties fall into the luxury or investment category. The new stress test won’t apply to loans being refinanced with the same lender and only federally regulated financial institutions are required to pass on this new test.
Elimination of Limited Dual Agency
The new superintendent of real estate announced in September that as of January 2018 the practice of limited dual agency will no longer be allowed in British Columbia. Limited dual agency is when a real estate agent represents a buyer and a seller during the same transaction. Due to obvious conflicts of interest that can arise in this situation this practice will no longer be legal in BC. From 2018 onwards, a buyer and a seller will need to deal with their separate individual agents when buying/ selling a home. Some exemptions apply to remote areas with limited numbers of real estate agents.
Housing affordability is a major issue effecting many parts of Canada right now and no where more acutely then in Vancouver and Whistler. Whistler is a unique market in the sense there is a development cap which limits the area in which new construction can be built. Because of this, building new homes is not an option which pushes prices up across the entire market. As Whistler becomes increasingly popular, especially with the US market heightened by big events such as Vail’s acquisition of Whistler Blackcomb, increased demand will continue to put upwards pressure on home prices. With programs such as the Whistler Housing Authority there are affordable housing measure in place in the community.
To discuss any of these events above and how they may affect your real estate goals in the New Year make sure to reach out.