May 2013 Market Update
On
May 14, British Columbians will head to the polls to elect their
provincial government. While recent opinion polls show that the trailing
BC Liberals have narrowed the gap with the NDP, it looks likely that BC
will have a new ruling party by the end of the month. But what does
that say for the BC housing market? Will the election of one party over
another influence the direction of prices and/or the pace of sales?
One
policy change that the real estate industry has been pushing has been a
reduction in the unfair and regressive Property Transfer Tax ( http://helpreducetheptt.ca/).
That said, no party formally opposes the tax, and only a few candidates
- from the BC Conservatives, the Social Credit, and the Green Party -
have outwardly campaigned against it. Expect it to stay.
Another
influence on the market is the uncertainty that the election holds.
We've seen a relatively quiet Spring Market this year, and some of that
can be attributed to people holding out until after the election. The
possibility of a new government along with vague policy platforms adds
to the uncertainty of the market, which will influence some buyers to
take a 'wait and see' approach to their potential purchases. A
re-election of a Liberal government will likely see people assume that
many of the same policies of the past 12 years will continue, while an
election of an NDP government will have individuals continue to be
cautious, as we find out whether they govern in the same moderately
cautious platform that they campaigned on.
Historically,
the NDP governed during a period (1991-2001) that saw average house
prices in the Greater Vancouver area appreciate at roughly $18,000/year.
The Liberals topped that by averaging house price increases of over
$50,000/year during their most recent tenure (2001-present). These
figures can be misleading though, as many outside factors, other than
government policy, come into play.
In
the end, it is difficult to determine what effect the election will
have on the housing market. It is important, however, to participate in
the process. On May 14th, vote.
To learn more, please feel free to contact me at the address above.
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